A former Chinese government official, Xiao Yi, has been handed a life sentence for operating an unauthorized $329 million Bitcoin mining venture and engaging in corruption. The Intermediate People’s Court of Hangzhou City found Xiao Yi guilty of both illegitimate business activities and unrelated bribery charges.
Bitcoin Mining and Corruption Convictions
Xiao Yi, previously a member of the Jiangxi Provincial Political Consultative Conference Party Group and Vice Chairman, was sentenced to life in prison for corruption and abuse of power. The corruption charges relate to bribery spanning 2008 to 2021, while the abuse of power charges stem from providing financial and electricity subsidies to Jiumu Group Genesis Technology, a firm running over 160,000 Bitcoin mining machines.
Former Chinese government official Xiao Yi awaits sentencing. |Â Source: Intermediate People’s Court of Hangzhou City
Cover-Up and Guilty Plea
Prosecutors stated that Yi concealed the mining operation by manipulating statistics and electricity consumption data. His actions led to Jiumu Group’s electricity usage accounting for 10% of Fuzhou’s total consumption. Yi admitted guilt, repented, and returned the embezzled funds. The court seized both bribe money and profits obtained from illicit activities.
China’s Crypto Restrictions and Legal Action
China has banned cryptocurrency transactions, exchanges, and fiat-to-crypto conversions, though ownership remains legal. A recent Chinese court ruling invalidated a $10 million Bitcoin lending contract, citing the country’s crypto ban. Additionally, aiding in crypto-related transactions has led to legal consequences, as evidenced by a Chinese national receiving a prison term for assisting in a Tether transaction.
