Before May 2021, China’s BTC mining hash rate of 55% was the largest globally. However, the country started a clampdown on all crypto activities after that period. A Chinese district court has claimed that crypto mining in China is still legal.
Crypto Mining Is Legal – Judge Qingtang
A network maintenance staff was charged to a district court in Chongming, Shanghai, over allegations of crypto mining. The accused (by the name Zhu) was alleged to have used the pcs under his supervision as a firm’s network maintenance manager to mine Ether. According to the prosecutor, Zhu mined ETH illegally through a remotely-controlled app and an installed graphics card and ASCII miner.
The prosecutor further alleged that Zhu earned 16K YUAN in profits from the sale of these illegally-mined ETH. The evidence before the court also alleged that Zhu conspired with others (who are not at large) to perform the act. Judge Yang Qingtang and his collegial panel were responsible for looking into the case based on the current Chinese crypto policies.
After the back and forth, the judge Qingtang-led panel ruled that Zhu should spend the next 11 months in prison and pay 5,000 YUAN in fines. Curiously, the panel didn’t find Zhu guilty of crypto mining. Instead, his sentence was because he “used the resources available to him illegally.”
Qingtang opined that crypto-mining could positively affect any nation’s economy. But he clarified that crypto mining in China isn’t in line with the country’s objective of reducing carbon emissions and conserving energy. But he maintained that Zhu’s offense and sentence were based on his actions of using company resources illegitimately.
China’s Crypto Policy
Last April, Chinese authorities, including ministries and agencies, highlighted the need to regulate crypto mining operations in the country. They agreed that the activities of crypto miners result in massive energy consumption.
They also opined that the positive impact these mining operations had on the economy was insignificant compared to the level of carbon emissions being released regularly to pollute the environment and climate and other negatives associated with crypto mining activities.
A representative of China’s development and reform agency said, “mining cryptocurrencies consumes huge amounts of energy and emits lots of carbon into the atmosphere. More importantly, they have a negligible impact on our industries and technological sectors.”
The representative further said, “the actions of these crypto miners have hindered socio-economic development, especially conservation of energy and a decrease in carbon emissions.” Thus, the Chinese authorities decided that the best way forward was a complete clampdown on all crypto-related activities, especially crypto miners.
Miners Flee
Consequently, many miners were forced to seek friendly crypto mining regions. However, BTC hash rates plummeted to new lows during this period. Apart from the spiral decline in BTC hash rates, BTC’s price also fell massively, and as is always the case, altcoins’ prices also followed suit. It remains to be seen whether Chinese authorities will issue any statement regarding judge Qingtang’s stance on crypto mining.
James Thompson