Energy-stealing crypto miner faces jail time in China

A man in China has been ordered to spend three years and six months behind bars over charges of mining cryptocurrency using stolen power from a local train station, local news outlets reported.

Authorities said Xu Xinghua, of Datong in China’s northern province of Shanxi, successfully mined 3.2 BTC—worth an estimated 120,000 yuan or $17,400)—as of April. His crypto mining operations, which involved 50 crypto miners and three electric fans, were allegedly powered by electricity stolen from one of the factories at the Kouquan Railway. Xu reportedly ran up an electricity bill of 104,000 yuan ($15,000), according to reports.

The Datong Railway Transport Court confiscated Xu’s mining rigs and also ordered him to pay the 100,000 yuan ($14,500) fine, cnBeta  reported. Xu was sentenced for his “miner theft case” last September 13.

Xu is the latest crypto-related case to have faced the wrath of the Chinese government, which has been relentlessly after crypto miners who it claims have been or are looking into illicitly using the country’s power supply. Recently, reports surfaced that China’s internet finance regulator, the Leading Group of Internet Financial Risks Remediation, has ordered local governments to “guide” crypto mining operations into making an “orderly exit” from the business. This comes on the heels of reports that the Chinese government is looking at limiting electricity supply to crypto miners.

The regulations, however, have yet to stop illegal crypto mining operations in China. In April, six people were reported to have stolen electricity from their local power grid to mine cryptocurrency. Two months later, a man was arrested in Anhui province on charges of stealing power of 150MW and running a bill of 6,000 yuan ($930) daily. According to reports, the man’s mining operation included 200 computers, which he used to mine BTC and ETH.

Note: Tokens on the Bitcoin Core (segwit) Chain are Referred to as BTC coins. Bitcoin Cash (BCH) is today the only Bitcoin implementation that follows Satoshi Nakamoto’s original whitepaper for Peer to Peer Electronic Cash. Bitcoin BCH is the only major public blockchain that maintains the original vision for Bitcoin as fast, frictionless, electronic cash.

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Chinese state bank issues $1.3B mortgages on blockchain

The Bank of Communications, a bank owned by the Chinese government, has successfully issued mortgage-backed securities worth over $1.3 billion on infrastructure powered by blockchain.

In one of the biggest moves of its kind to date, the bank used an independent blockchain platform called Juicai Chain to issue the securities, worth a total of 9.3 billion yuan ($1.3 billion), China Securities Times reported.

Through the platform, all parties to the underlying loan are trackable, and can manage their cash flow as well as performing a number of other business operations on the blockchain. According to local press reports, the hope is that the system will improve security, limit risk exposure and improve the efficiency with which mortgage backed securities can be issued.

The technology also allows instant verification of the authenticity of the assets, as well as providing several other key benefits to would-be investors in these securities.

China has been notoriously hardline on cryptocurrencies and initial coin offerings (ICOs), effectively banning outright a large portion of activity in the cryptocurrency sector. However, conversely, the Chinese state is regarded as an increasing supporter of blockchain technology, with several notable deployments by government-backed organisations in the country.

Back in July, the Agricultural Bank of China issued a loan worth $300,000 on the blockchain, while in September, Chinese authorities signaled they may be willing to accept blockchain data as admissible evidence in legal cases.

The system pioneered by the Bank of Communications is one of many blockchain developments around real estate and real estate-backed securities, and the expectation now is that their successful launch will inspire similar moves from other financial institutions.

As reported in local media, Juicia Chain was first launched by the bank back in June, with initial due diligence beginning in August. Going forward, the digital mortgage base will now be opened to a number of intermediaries including law firm Zhonglun and global professional services company PricewaterhouseCoopers.

With the Agricultural Bank of China and the Bank of Communications accounting for the fourth and fifth largest banks in the country respectively, the new platform is now likely to have a significant effect on the way similar securities are issued in future.

Note: Tokens on the Bitcoin Core (segwit) Chain are Referred to as BTC coins. Bitcoin Cash (BCH) is today the only Bitcoin implementation that follows Satoshi Nakamoto’s original whitepaper for Peer to Peer Electronic Cash. Bitcoin BCH is the only major public blockchain that maintains the original vision for Bitcoin as fast, frictionless, electronic cash.

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China’s central bank warns public (again) against cryptos, ICOs

Residents in China have received a new warning against getting involved in cryptocurrency-related activities. This week, the People’s Bank of China (PBoC) has issued yet another notice to remind everyone in the country against investing in cryptocurrencies and initial coin offerings (ICOs) amid reports that domestic crypto activities have been flourishing recently.

According to the central bank, the cryptocurrency market is filled with so many uncertainties. The industry has seen skyrocketing prices, disrupting the market. The PBoC also reaffirmed its stance that ICOs do not have a proper financing mechanism, which needs to be regulated by relevant authorities. The PBoC notice reminded Chinese citizens that ICOs are “suspected of illegally selling tokens, illegally issuing securities, illegal criminal activities, financial fraud, pyramid schemes and other illegal and criminal activities.”

According to the Chinese central bank, “It is important for consumers and investors to increase their awareness of risks associated with the industry and avoid falling in the same traps.”

The announcement comes a few weeks after the bank revealed a significant drop in cryptocurrency activities in the country. In August, PBoC stated that “The global share of domestic virtual currency transactions has dropped from the initial 90% to less than 5%, effectively avoiding the virtual currency bubble caused by skyrocketing global virtual currency prices in the second half of last year in China’s financial market.”

Since it banned ICOs in September 2017, mainland authorities have already shut down 88 ICO platforms and 85 ICO projects in the country.

However, reports recently surfaced that some investors and companies were braving the regulatory forces in China. Underground crypto transactions have become the order of the day with many people looking for ways around the ban. According to reports, some traders have resorted to using Virtual Private Networks (VPNs), while others opted for offshore exchanges. Others have turned to peer-to-peer transactions to pay for services and products or purchase their favorite currencies and tokens.

Note: Tokens on the Bitcoin Core (segwit) Chain are Referred to as BTC coins. Bitcoin Cash (BCH) is today the only Bitcoin implementation that follows Satoshi Nakamoto’s original whitepaper for Peer to Peer Electronic Cash. Bitcoin BCH is the only major public blockchain that maintains the original vision for Bitcoin as fast, frictionless, electronic cash.

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