Chinese Man Jailed for 3.5 Years for Mining Bitcoin with Stolen Train Electricity

A Chinese man has been jailed for three and a half years because he fueled his Bitcoin mining operations with power from a train station. This news was made known on October 8 by The Paper, a local media outlet.

According to released court documents, the man was sentenced at the Datong Railway Transport Court on September 13 in China’s northern Shanxi province. The man, whose name was given as Xu Xinghua, was also fined 100,000 yuan (about $14,500) in addition to his jail sentence.

Prison Cell

Image via Pixabay

The court documents further revealed that back in November and December 2017, Xinghua powered his three electric fans and 50 bitcoin miners around the clock with stolen electricity from one of several factories located at Konquan Railway. In addition, five of his mining machines were broken during this period of time.

Xinghua was also said to have mined 3.2 bitcoin successfully as of April 2018, which netted him 120,000 yuan (around $17,400) while simultaneously running up a 104,000 yuan ($15,000) electricity bill. In addition to the fine and jail time, the court has seized Xinghua’s mining equipment and has also ordered him to clear off the electricity charges.

As bizarre as this report may seem, it is not a unique situation in China. Another Chinese man in Anhui province was arrested in June for his attempt to fund his “unprofitable” mining operations with stolen electricity.

The man was reported to have fueled 200 computers with stolen 150 megawatt (MW) that he used in mining both Ethereum and Bitcoin. This resulted in a daily electricity bill of more than 6000 yuan ($930).

At the beginning of the year, reports emerged that the Chinese authorities have hatched out attempt to quash the country’s cryptocurrency industry. This is on the strength of China’s emergence as a crypto mining giant because of its cheap hardware and energy supply.

A memo that was leaked from the People’s Bank of China (PBoC) to a top-level government FinTech regulator stated that “Bitcoin miners should make an orderly exit from the country due to them sapping huge amounts of resources and stoking speculation of virtual currencies.”

On receiving the memo, the FinTech regulator is said to have commanded “local administrations to use every available weapon in their arsenal – including measures linked to electricity price, tax, land use, and environmental protection – to pressure miners to cease operations.”

To conclude

A man in China has received a jail time of three and a half years, in addition to a fine of 100,000 yuan (about $14,500) for fueling his Bitcoin mining operations with the electricity he stole form a train station.

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