Chinese Communist Party Official Pleads Guilty to Aiding Bitcoin Miners

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According to a report by the state daily news program Xinwen Lianbo on Dec. 29, Xiao Yi, former Communist Party secretary of Fuzhou City, pleaded guilty to corruption charges in the Zhejiang Hangzhou Intermediate People’s Court. . During his tenure as director from 2008 to 2021, Yi was accused of accepting more than CNY125 million ($18 million) in bribes related to construction schemes and illicit promotions.

In addition to the aforementioned counts, Yi also pleaded guilty to charges related to business transactions between him and Bitcoin (BTC) miners from 2017 to 2021. It is unclear whether the series of charges were related. As reported by Xinwen Lianbo:

“During his tenure from 2017 to 2021 as Communist Party Secretary of Fuzhou City, Xiao Yi provided support to cryptocurrency mining companies in the form of grants, capital grants, and grants. electricity insurance. These acts were contrary to national regulations, the theory of New Development, and led to massive losses of public assets, resulting in adverse consequences.”

Citing the need to meet “carbon neutral” goals and “high energy costs,” the Chinese government banned all cryptocurrency mining activities on September 24, 2021. The legislation blocks access for miners from cryptocurrency to electricity markets, capital markets and global investment. to prohibit.

However, it appears the ban has been difficult to enforce, in part due to the decentralized and peer-to-peer nature of cryptocurrency mining. In May 2022, Cointelegraph reported that China had once again become the world’s second largest Bitcoin mining center despite the ban. The legislation itself also allows local authorities to impose a cryptocurrency mining tariff of CNY 0.30 per kWh ($0.0431) of electricity used as an alternative to power cuts in the event of a discovery. The court has been adjourned for the sentencing of Xiao Yi in the next session.

Chinese Crypto Miners Prove Resilient Despite Nationwide Crackdown | Source: Cambridge Bitcoin Electricity Consumption Index

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