According to a report published by the state-run Xinwen Lianbo newspaper on December 29, Xiao Yi, a former Fuzhou City Communist Party secretary, pleaded guilty to corruption charges before the Hangzhou Intermediate People’s Court in Zhejiang. During his tenure as director between 2008 and 2021Yi was accused of accepting more than 125 million CNY ($18 million) in bribes related to illicit construction programs and promotions.
In addition to the aforementioned charges, Yi also pleaded guilty to charges related to business transactions between him and Bitcoin (BTC) miners from 2017 to 2021. It is unclear if the series of charges were related. As reported by Xinwen Lianbo:
“During his tenure from 2017 to 2021 as Fuzhou City Communist Party Secretary, Xiao Yi provided support to cryptocurrency mining companies in the form of grants, capital grants, and electricity guarantees. These acts were contrary to national regulations. , to the New Development theory, and led to massive losses in public property, which led to adverse consequences.”
Citing the need to achieve “carbon neutrality” goals and “high energy costs,” the Chinese government banned all cryptocurrency mining activities on September 24, 2021. The legislation blocks cryptocurrency miners’ access to electricity and capital markets, and prohibits investment in general.
However, the ban appears to have been difficult to enforce, partly due to the decentralized and peer-to-peer nature of cryptocurrency mining. In May 2022, Cointelegraph reported that China has 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 fee of CNY 0.30 per kWh (USD 0.0431) of electricity usage as an alternative to power outage in case of discovery. The court has adjourned the sentencing hearing against Xiao Yi to the next session.
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