Chinese Communist Party official pleads guilty to helping Bitcoin miners

According to a report published by state-owned each day information program Xinwen Lianbo on Dec. 29, Xiao Yi, the previous Communist Party secretary of the City of Fuzhou, pleaded guilty to corruption prices within the Zhejiang Hangzhou Intermediate People’s Court. During his tenure as director from 2008 to 2021, Yi was accused of accepting over 125 million Chinese yuan ($18 million) in bribes associated to building packages and illicit promotions.

In addition to the aforementioned counts, Yi additionally pleaded guilty to prices associated to enterprise transactions between himself and Bitcoin (BTC) miners from 2017 to 2021. It is unclear if the collection of prices have been associated. As reported by Xinwen Lianbo:

“During his 2017 to 2021 tenure because the Communist Party Secretary of the City of Fuzhou, Xiao Yi supplied assist to cryptocurrency mining corporations within the type of subsidies, capital help, and electrical energy assurance. These acts have been opposite to nationwide rules, the idea of New Development, and led to large losses in public property, main to antagonistic penalties.”

The court docket has been adjourned and can sentence Yi within the upcoming session.

Citing the necessity to obtain “carbon neutrality” targets and “excessive vitality prices,” the Chinese authorities banned all cryptocurrency mining activities on Sept. 24, 2021. The laws blocks cryptocurrency miners’ entry to electrical energy and capital markets and contains an general funding ban. 

However, it seems the ban has been troublesome to implement, partly due to crypto mining’s decentralized and peer-to-peer nature. In May 2022, Cointelegraph reported that China has returned because the world’s second-biggest Bitcoin mining hub despite the ban. The laws itself additionally permits native authorities to impose a cryptocurrency mining tariff of 0.30 yuan ($0.0431) per kilowatt-hour of electrical energy use instead to reducing off vitality within the occasion of discovery.

Chinese crypto miners have confirmed to be resilient regardless of a nationwide crackdown. Source: Cambridge Bitcoin Electricity Consumption Index