Chinese Government Official Sentenced To Life In Prison For Illegal Operations And Corruption Related To Bitcoin Mining

Xiao Yi, a former member of the Political Consultative Party Group, was sentenced to life. (photo: dock. special)

JAKARTA - A Chinese government official has been sentenced to life imprisonment for carrying out illegal business operations in managing a Bitcoin mining company worth 2.4 billion Chinese Yuan (Rp4.9 trillion) and unrelated corruption charges.

Based on local media reports, on August 22, the Hangzhou City Medium-Level People's Court sentenced Xiao Yi, a former member of the Jiangxi Province Political Consultative Party Group and Deputy Chair, to life imprisonment and abuse of power.

Allegations of corruption stem from activities outside of crypto, namely accepting bribes between 2008 and 2021. Meanwhile, allegations of abuse of power, which occurred between 2017 and 2021, stemmed from the provision of financial and electric subsidies to Jiumu Group Genesis Technology, a company based in Fuzhou City and at one point operating more than 160,000 Bitcoin mining machines.

Prosecutors said Yi "covered up" the mining operation by ordering relevant departments to make fake statistical reports and change the classification of electricity consumption. Between 2017 and 2020, Jiumu's electricity consumption accounted for 10% of Fuzhou's total electricity consumption.

"Yi pleaded guilty and regretted, actively returned the stolen funds, and all her bribes and profits have been confiscated," the judge wrote in the Hangzhou People's Court ruling.

Currently, China has banned all forms of crypto transactions, exchange operations, and the use of cryptocurrencies as a means of payment, but it has not explicitly banned crypto holdings. In a decision on August 3, a court in China stated that the contract for granting Bitcoin loans worth US$10 million (Rp151 billion) was illegal under the ban on Bitcoin in the country and there was no possibility of recovering debt law.

On August 14, a Chinese citizen was also sentenced to nine months in prison for helping an acquaintance buy Tether (USDT) and making a profit of 20 US dollars (Rp. 300 thousand) from the transaction.