A report by a Chinese state media outlet claims that authorities in China have seized 6,890 mining rigs in the Hebei province of China. Additionally, authorities recently managed to arrest 72 people accused of running fraudulent multi-level marketing schemes.
The media reports indicate that the operation took place in the City of Tangshan. The report claims that the operation began in April last year after authorities noticed an uptick in the theft of electricity to power mining rigs. During the operation, the authorities inspected over 70,000 households, 3061 merchants, 1470 communities and villages, factories, mines, and courtyards.
It is claimed that the power theft first raised suspicion when authorities found a privately installed transformer in a person’s home. In the same compound, they found two containers that had been modified to house mining rigs. They determined that the illegally connected transformer was siphoning power from the grid and using it to mine crypto. The report added that they managed to seize 1,906 mining rigs from the compound.
Upon further investigations, they managed to seize 3 more transformers and 790 mining rigs that were siphoning power from the grid. The authorities estimate that the 790 rigs could consume the same power in one day that is used by 5,000 homes in a day. Thus far, authorities have managed to seize 52 transformers and 6,890 mining rigs. The operation is still ongoing.
Cloud Token Scam Stopped
Local media reports also indicate that authorities in the Taiyuan city in Shanxi province managed to nub 72 Cloud Token operatives. This was revealed in a widely circulated video on Weibo. The video shows police arresting dozens of people with their hands cuffed, wearing numbered vests and black sacks. According to authorities, the Cloud Token scam was worth over $4 million and affected over 300 victims. However, no further information regarding reimbursement of the victims has been revealed.
China is a Major Contributor to Crypto Mining
Crypto miners in China are estimated to control almost 70% of the mining power. This huge influence of China in the mining sector has raised concerns amongst some in the crypto world. It is worth noting that except for stopping illegal mining operations, China does not intend to ban crypto mining in the nation. However, China has been actively cracking down on crypto businesses in the nation. This renewed effort is an attempt to have the nation focus on the blockchain instead of crypto.
China’s Complex Relationship with Crypto
China’s relationship with the crypto industry is quite complicated. While the nation has not banned crypto mining, it does allow its citizens to participate in crypto trading. For instance, it recently banned the Weibo accounts of Binance and Tron from Weibo without any explanation.
This complex relationship is unlikely to change. It is especially so since China plans to launch a national digital currency soon. It clearly does not want a competitor to its national digital currency, which it expects will improve the efficiency of its economy and ensure access to banking services for those in rural parts of the nation.
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