Why was an official in a small Chinese city arrested for "mining"?
Foreword: How a company located in Fuzhou, a small city in China, colluded with Chinese government officials and businessmen, and was finally arrested. It is also worth noting that the Chinese company, which had a complex legal battle with Genesis mining, was sued for illegally misappropriating nearly 500,000 of its GPUs and other Bitcoin ASIC miners. Genesis mining has suffered such a heavy loss that it has received more than $1 billion in financing from FTX in 2021–2022. This is also the most absurd and huge investment that FTX may embezzle customer savings and invest.
The following is the full text of China Central Television
On the evening of January 8, the second episode of the TV feature film “Forever Blowing the Charge” — — “Political Supervision” was broadcast on China Central Television. Xiao Yi, Lin Qingxing and others appeared on TV.
Narrator: Jiumu Group Genesis Technology Co., Ltd., located in the High-tech Development Zone of Fuzhou City, is one of the problematic projects that cadres and the masses have concentrated on. During his tenure, Xiao Yi regarded this enterprise as a “business card” of Fuzhou’s “digital economy” industry, and publicized it as a high-tech company engaged in “big data” and “cloud computing”. However, Xiao Yi actually knew that this “business card” was seriously inaccurate. The company was really engaged in the production of virtual currency calculations, commonly known as “mining”, which means “mining” virtual currency on the Internet.
Xiao Yi said: I knew he would “mining”. When he came in, the cryptocurrency fell in 2018, and he told me that he wanted to transform. In 2019, the cryptocurrency went up again, and he basically did not follow what he said. During the transformation, he was concentrating on “mining”.
(Xiao Yi:” I was also regretting.”)
Lin Qingxing (the actual controller of Jiumu Group Genesis Technology Co., Ltd.) said: I also told him that our company has mining business. The digital economy needs such an achievement as a political achievement while we need a business card and Fuzhou also needs a business card.
Narrator: Xiao Yi asked Lin Qingxing to disguise his company as a big data company to cover up that Lin Qingxing’s company is actually a “mining” company. Some leading cadres have also formed a “mining” interest community with Lin Qingxing’s company. He offered some leading cadres in Fuzhou, especially in the high-tech zone, the lease of “mining machines”, including services such as hosting, which is equivalent to paying some money, and he can get the benefits of bitcoin “mining” .
Narrator: Beginning in 2018, China has clearly required local governments to guide “mining” companies to exit in an orderly manner, and then further explicitly prohibited the development of cryptocurrency “mining” projects in any name. Xiao Yi was very clear about the national policy, but still took chances and tried to hide the truth, instructing Lin Qingxing’s company to “perform” some other business when someone came to visit and inspect.
Lin Qingxing: He would ask me not to talk about “mining” when the leaders came over, and said that the “mining machine” could pretend to run artificial intelligence by changing the operating system.
(Lin Qingxing appeared on the screen)
Narrator: From 2017 to 2020, Lin Qingxing’s company had about 160,000 “mining machines” running every day while this company’s electricity consumption accounted for 10% of Fuzhou’s total electricity consumption. In order to cover up the real situation, Xiao Yi instructed relevant departments to fabricate statistical reports and adjust the classification of electricity consumption. He also illegally demanded financial subsidies for the company and pushed government agencies to provide the company with guarantees, loans and other financing support amounting to more than 2.4 billion yuan, and helped the company build a new data center building in the high-tech zone.