- He concealed Bitcoin mining operations, gave financial and electricity subsidies
- The corruption charges are unrelated to cryptocurrency, involve bribery
A Chinese court sentenced a government official to life in prison for illegal business operations involving a $329 million Bitcoin mining company (2.4 billion Chinese yuan) and corruption, Cointelegraph reported, citing a local publication.
The Intermediate People’s Court of Hangzhou City sentenced Xiao Yi, vice chairman of the Jiangxi Provincial Political Consultative Conference Party Group and a former member, to life in prison for abuse of power and corruption.
Corruption charges are for bribery
The corruption charges are unrelated to cryptocurrency and involve bribery. They stem from 2008 to 2021. He is also charged with abuse of power for giving the company Jiumu Group Genesis Technology financial and electricity subsidies from 2017 to 2021.
He concealed Bitcoin mining operations
This firm, which is located in the city of Fuzhou, operated more than 160,000 Bitcoin mining machines at one point. According to prosecutors, the defendant concealed the mining operation by ordering employees to make up statistics and modify the categorization of electric power consumption.
Jiumu Group consumed a tenth of the city’s electric power from 2017 to 2020. According to the judge presiding over the case, the defendant pled guilty, expressed remorse, and returned the money he helped steal. All the bribes and the related profits have been seized.
Chinese crypto ban is not effective
Currently, China has banned all cryptocurrency transfers, crypto exchanges, and fiat-to-crypto onboarding. The ban dates from September 2021. On Aug. 3, a court ruled a Bitcoin lending agreement worth $10 million was not valid and excluded any possibility of legal debt recovery.
However, it seems the ban is not as effective as initially hoped for. According to a 2022 analysis by Bankless Times, China is reentering the global crypto adoption index top 10 list.
Criticism of the ban
The country has stopped short of prohibiting crypto ownership. There has been criticism of the ban, including from relatively high-profile figures. Huang Yiping, a former official with the People’s Bank of China, called on the government to reconsider it earlier this year, questioning its long-term sustainability.
