China's Inner Mongolia set to impose eight measures on crypto mining ban
*Quick Take
The Inner Mongolia Development and
Reformation Commission issued a proposal on
Tuesday that outlined eight areas that could be
deemed as illegal that relate to crypto mining
activities.
*It is the first, more concrete proposal to emerge
four days after a Chinese State Council
committee raised the subject of a bitcoin
trading and mining crackdown during a recent
meeting.
The government of China's Inner Mongolia region has proposed eight new measures to phase out crypto mining activities.
The Inner Mongolia Development and Reformation Commission (DRC) issued a proposal on Tuesday that outlined eight areas that could be deemed as illegal that relate to crypto mining activities. It is the first, more concrete proposal to emerge four days after a Chinese State Council committee raised the subject of a bitcoin trading and mining crackdown during a recent meeting.
The proposal is now set to go through a public consultation process that will last until June 1 before it takes effect. The proposed measures target not only crypto mining facilities in the region that mostly use fossil fuels but also power stations that supply energy to such operations. Internet cafes that may have been using idle computers to mine cryptocurrencies are also included.
In addition, any enterprise or individual using cryptocurrency for money laundering or fundraising activities in the region could also be liable for a criminal offense. According to the published proposal, any corporation or individual found engaging in crypto mining activities could also put into China's Social Credit Dishonesty List, which would bar them from social activities such as getting banked, booking air or train tickets, etc.
The latest measure comes as the Inner Mongolia government is stepping up efforts to meet China's carbon neutrality goal, as The Block reported previously. In March, the local government already released a plan to shut down crypto mining activities in the region but the latest proposal intensifies such efforts with additional and specified legal liabilities for any individual or corporate that fails to comply. Since then, local miners there have already started to relocate their operations elsewhere in the country or overseas.
It remains to be seen if other main crypto mining provinces, especially Sichuan and Yunnan – where the energy is mostly based on hydro-electricity – would follow the Inner Mongolia's measure.
Below is the full translation of the eight proposed measures:
1.For any industrial parks, data centers, power stations that provide the land and power support for crypto mining companies, there will be an intensified regulatory oversight based on the relevant laws such as China's Energy Conservation Law and the Electric Power Law. For any entity that is intentionally hiding such activities or does not shut them down in time or does not hold a strong approval process, they will be held responsible based on the relevant regulations and the laws within the Communist Party;
2.Supervising government agencies shall cancel any policy perks for any big data center or cloud computing company that is involved in crypto mining activities and they shall be dealt with accordingly based on the Energy Conservation Law;
3.For any communications or internet companies that are involved with crypto mining conducts, the supervising government agencies shall discharge their telecommunications business licenses based on the Regulation on Telecommunications of the People’s Republic of China and they shall be dealt with accordingly;
For any internet cafes that are involved in crypto mining activities, their supervising agencies shall suspend and rectify their businesses;
For any entity that privately supplies energy to crypto mining activities without prior approval, they shall be handled by judiciary authorities based on China’s Criminal Laws;
4.For any entity or individual that is involved in using virtual currency for illegal activities such as money laundering, they shall be handled by judiciary authorities based on China's Criminal Laws;
5.For any entity or individual that is involved in using virtual currency for fundraising activities, they shall be dealt with by their supervising agencies based on the Regulation on the Prevention and Treatment of Illegal Fund;
For any corporation or related personnel that is involved in crypto mining business, they will be put into China’s List of Dishonesty. Any public servants who used their positions to provide convenience or protection for crypto mining activities will be handled by the relevant Discipline Inspection Committee under the Communist Party.