Court ruling invalidates China’s crypto mining contract and shuts down Bitcoin farms – Mining Bitcoin News
A Beijing court ruled that the three investment agreements for the Sichuan Bitcoin mining business were “invalid”. The claim for compensation in this case has been dismissed, which is seen as an indication that the Chinese judiciary will not provide protection for the interests related to encryption.
Beijing court ruled that Bitcoin mining contract is invalid
The People’s Court of Chaoyang District, the capital of China, recently rejected a lawsuit seeking compensation from an encryption company. The Hong Kong Daily South China Morning Post quoted a mainland official media report that one of the company’s customers failed to get a return on their bitcoin mining investment.
The plaintiff, Beijing Fengfu Marketing Technology, signed three agreements with Zyzc Blockchain Technology in May 2019 to deploy mining hardware in Sichuan, for which it paid 10 million yuan (1.6 million U.S. dollars). At that time, the central government was still tolerant of cryptocurrency mining, and some local authorities, including the province, allow Bitcoin farms use surplus water and electricity.
China banned crypto-related activities, such as trading, as early as 2017, but the government did not intervene in mining until this spring. In May of this year, after President Xi Jinping promised to achieve carbon neutrality in the next 40 years, the State Council decided to rectify the industry.Since then, the government’s offensive has spread to provinces like this Sichuan.
In his plea, Beijing Phonf revealed that he had received 18.35 Bitcoin, Valued at approximately US$904,000 at the time of writing, but has decreased in the previous period, and requires the company with which it is cooperating to pay another 278.17 Bitcoin In compensation. In the first case of this kind, according to the report, the court has determined that the mining contract is invalid. The newspaper commented that the decision shows that the Chinese judicial system has no intention to recognize or protect the interests related to cryptocurrency.
Sichuan Province closes mines affected by court decision
After dismissing the lawsuit, the Chaoyang District Court notified the Provincial Branch of the National Development and Reform Commission (Development and Reform Commission) In Sichuan. Officials of the economic planner took steps to close the remaining mining facilities involved in the case and targeted other coin minting projects.
Inspections to identify illegal mining activities have also been conducted elsewhere. For example, Zhejiang authorities recently raided nearly 22 government organizations, including universities, and determined that 14 of them were mining cryptocurrency.
In addition to Sichuan and Zhejiang, the government’s suppression of mining this year has also spread to many provinces, such as Xinjiang, Qinghai, Yunnan, Inner Mongolia, Anhui, and Hebei. In November, the Development and Reform Commission returned Announce It is hunting down state-owned industrial companies involved in the extraction of digital currency.
Do you think this judgment of the Beijing court will determine how the Chinese judiciary will treat similar cases in the future? Share your thoughts on this topic in the comments section below.
Image Source: Shutterstock, Pixabay, Wikimedia Commons
Disclaimer: This article is for reference only. It is not a direct offer or invitation to buy or sell, nor is it a recommendation or endorsement of any product, service or company. Bitcoin Network Does not provide investment, tax, legal or accounting advice. The company or the author is not directly or indirectly responsible for any damage or loss caused or claimed to be caused by using or relying on any content, goods or services mentioned in this article.