Former Chinese Official Faces Life Behind Bars for Illicit Bitcoin Mining and Bribery
Xiao Yi, a former Chinese official, has been sentenced to life for corruption and illicitly aiding a massive Bitcoin mining operation, highlighting China's strict cryptocurrency stance.
Fri, 25 Aug 2023, 08:41 am UTC
Hangzhou City's Intermediate People’s Court has handed down a life sentence to Xiao Yi, previously part of the Jiangxi Provincial Political Consultative Conference Party Group and its vice chairman. This verdict was reached on August 22 due to significant charges of corruption and abuse of power.
Xiao's corrupt practices, unrelated to cryptocurrency, spanned from 2008 to 2021 and mainly revolved around bribery. However, what caught significant attention was his involvement from 2017 to 2021 with Jiumu Group Genesis Technology, a Fuzhou-based company. This company, under Xiao's influence, benefited from financial perks and electricity subsidies, operating an impressive number of over 160,000 Bitcoin mining machines during its peak.
Authorities disclosed that Xiao played a role in the concealment of Jiumu’s mining activities. He allegedly directed associated departments to manipulate statistical data and falsely represent electricity usage classifications. Reports indicate that between 2017 and 2020, Jiumu was responsible for consuming an astonishing 10% of Fuzhou’s entire electricity.
Hangzhou People’s Court documents reveal that Xiao has admitted to his wrongdoings. Demonstrating remorse, he has actively begun repaying the misappropriated funds. The court has seized all the illicit gains, which include the bribes and their resulting profits.
As background, China maintains a stringent stance on cryptocurrency activities. While the nation hasn't declared outright ownership illegal, it has clamped down on cryptocurrency transactions, exchanges, and fiat-to-crypto conversions. This stance was underlined on August 3 when a Chinese court declared a $10 million Bitcoin lending contract void due to China's Bitcoin restrictions. Furthermore, on August 14, a Chinese individual received a nine-month prison sentence over a mere $20 profit he made while assisting a peer in buying Tether (USDT).
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