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Prohibition measures such as virtual currency mining The Mongolian government in China announces the contents of the proposal

Cryptocurrency

Inner Mongolia: 8 ban proposals

Following the policy of tightening crackdowns on Bitcoin mining and transactions announced by the State Council of the People’s Republic of China on the 21st, the Inner Mongolia Autonomous Region government, where many miners are based, has announced a proposal for a ban in line with the policy.

The proposal includes eight measures to be implemented to phase out mining activities within the Inner Mongolia Autonomous Region. At the moment, it is in the proposal stage, and we plan to solicit opinions from the general public by June 1.

In addition to illegal mining, it was also stated that if an individual or corporation uses virtual currency as a means of money laundering or financing, it may be a criminal offense.

According to the proposal, if the above-mentioned illegal use of mining or virtual currency is discovered, it will be added to the “illegal list” of the social credit system enforced by the Chinese government, and various things such as opening a bank account and booking airline tickets will be added in the future. It is said that it can be excluded (prohibited) from such “social activities”.

Specific measures

The content of the proposal that summarizes the eight points is as follows.

1. Data centers, power plants, industrial parks, etc. that provide locations and electricity to crypto miners are monitored by the Conservation of Energy Act and the Electricity Act. In addition, companies that do not cover up, shut down, or do not have formal permits will be held liable under the relevant Communist Party regulations and laws.

2. The supervising government agency should revoke the incentives such as regulations that have been given to data centers and cloud computing companies related to cryptocurrency mining.

3. The supervising government agency should revoke the license of the telecommunications business for telecommunications and internet companies involved in cryptocurrency mining activities.

4. The supervising government agency should suspend the business license of Internet cafes involved in cryptocurrency mining activities.

5. Entities that personally provide power to crypto miners without permission should be treated by the judiciary under criminal law.

6. Individuals and entities that launder money using virtual currencies should be treated by the judiciary under the criminal law.

7. Individuals and entities that use cryptocurrencies to raise funds should be treated by the authorities in accordance with regulations on fraud prevention and countermeasures.

8. Individuals and companies involved in the cryptocurrency mining business are added to the “fraud list” of the Social Credit System. In addition, civil servants who used their position to provide convenience and protection to cryptocurrency mining businesses should be treated by the Communist Party’s Discipline Inspection Committee.

At the moment, proposals for measures by Inner Mongolia have been clarified in this way, but no clear policy has yet been announced in other areas where many minors are active, such as Sichuan and Yunnan.

In addition, the scope of coverage of cases in Inner Mongolia, such as the scale of businesses that have licenses for data centers and perform mining, is not clear at this point, and there is strong uncertainty in the market.

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Author: Lewis Kikutani
Reference: The Block

Images used under Shutterstock license
“Cryptocurrency” means “cryptographic assets”

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