[NTD News November 15, 2021 Beijing time]Xiao Yi, the former vice chairman of the Jiangxi Provincial Committee of the Chinese People’s Political Consultative Conference, was “double-opened”. He was the first provincial and ministerial-level senior official to be sacked because of his involvement in virtual currency “mining”. According to news, the German companies that cooperated with Xiao Yi to “mining” reported to Zhongnanhai high-level officials through the Ministry of Foreign Affairs of the Chinese Communist Party, and Xiao Yi was investigated and punished.
The website of the Central Commission for Discipline Inspection of the Communist Party of China reported on November 13 that Xiao Yi was expelled from the party and public office, and it was rarely mentioned that Xiao Yi supported virtual currency “mining” activities that did not meet the requirements of national policies, which caused a bad impact. This is the first provincial and ministerial level official to be investigated for involvement in “mining.”
“Mining” refers to the nickname for the exploration method of obtaining bitcoins through computers. It is named because its working principle is very similar to mining minerals.
The Chinese new media “Conscience of the Currency Circle” recently released an article that during his tenure as Secretary of the Fuzhou Municipal Party Committee in Jiangxi Province in 2015, Xiao Yi vigorously promoted the “digital economy” and was actually doing a Bitcoin “mining” business.
According to a report by “Fuzhou Release” in December 2017, Xiao Yi visited Germany at that time and had an official meeting with the Munich GM Foundation. GM is one of the world‘s largest blockchain technology companies.
In June 2017, GM and Fujian businessman Lin Qingxing invested RMB 4 billion in the Fuzhou High-tech Zone to build a supercomputer computing service center for Genesis Technology Co., Ltd. At that time, the installation of 24,000 servers in two data centers was completed and put into operation.
After the meeting, Fuzhou High-tech Zone, GM Foundation and Fuzhou Genesis Technology Co., Ltd. signed a tripartite framework agreement on the construction of a supercomputing industry center project. The agreed total investment is not less than 1.69 billion U.S. dollars, and a total of 500,000 servers will be installed and put into operation in two phases.
According to multiple industry sources, Fuzhou Genesis is actually a virtual currency mining company, and its big data center in Fuzhou is actually a Bitcoin mining farm.
Under the protection of Xiao Yi, Fuzhou Genesis Company publicly mined in Fuzhou and unearthed tens of thousands of bitcoins. Later, there was an interest dispute with the German GM Foundation.
The article said that German companies “fought lawsuits all the way to lose” and eventually “stuck things up” through diplomatic channels. The above instructed the Central Commission for Discipline Inspection to conduct a thorough investigation. On May 18 this year, Xiao Yi fell from the horse and Lin Qingxing was also arrested.
The article quoted people familiar with the matter as revealing that during Xiao Yi’s tenure, he accepted bribes of more than 8,000 bitcoins, with the latest market value exceeding RMB 2.2 billion.
After Xiao Yi fell due to “mining”, the Internet Finance Association of the Communist Party of China, the Banking Association of the Communist Party of China, and the China Public Payment and Clearing Association issued the “Joint Announcement on Preventing the Risk of Virtual Currency Speculation”, which triggered a sharp drop in the prices of multiple virtual currencies.
Mainland China was originally the center of virtual currency “mining”, and 70% of the world‘s “mining” is carried out in China. Because “mining” is a high-energy-consuming industry, and there are potential financial risks. In September of this year, the National Development and Reform Commission of the Communist Party of China issued a notice on rectifying virtual currency “mining” activities.
On September 24, the Central Bank of the Communist Party of China and other top ten regulatory agencies jointly issued the “Notice on Further Preventing and Disposing of the Risks of Virtual Currency Trading Speculation”, stating that cryptocurrency-related transactions are all illegal. It is notified that the names of virtual currencies such as Bitcoin, Ether, and TEDA will be named, and their circulation in the Chinese market is strictly prohibited, resulting in a sharp drop in the price of virtual currency Bitcoin.
(Reporter Luo Tingting Comprehensive Report / Chief Editor: Wen Hui)
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