Author: Iris, Lawyer Xu Xiaohui

When it comes to Web3 mining, I wonder if anyone here shares the same confusion as Lawyer Mankun: Can Chinese people still participate?

First of all, it is certain that Chinese people can no longer participate in the domestic mining industry.

As early as September 2021, the notice issued by the National Development and Reform Commission and other departments clearly prohibited the development of virtual currency "mining" in any form. Since then, there has been a wave of miners going overseas, with many mining farms relocating to countries and regions such as Australia and Europe.

So, does going overseas mean everything is fine?

Clearly, it is not that simple.

In 2022, regulatory agencies in countries/regions including Russia and the European Union began to call for and take steps to ban energy-intensive cryptocurrency mining models, with BTC mining being the primary target. On March 5, 2025, the Chinese Embassy in Angola pushed out a related article titled “Reminder: Comply with the Law, Do Not Engage in Virtual Currency 'Mining'”.

*Image source: Announcement from the Chinese Embassy in Angola

The article points out that in April 2024, Angola introduced a ban on mining and began ongoing special operations to crack down on domestic cryptocurrency mining activities. In this operation, multiple cases of Chinese citizens participating in virtual currency mining have been uncovered. Additionally, a previous announcement from the embassy stated that virtual currency mining is a criminal act, and anyone involved in mining, providing electricity for mining, or even storing related equipment could face imprisonment ranging from 1 to 12 years upon investigation.

Here, someone might mention another fact: By 2024, Russia has begun to support BTC mining, and other countries like Thailand have always allowed legal mining.

So, can we Chinese people go to these countries and regions that support virtual currency mining and mine legally?

This is precisely the core issue that Lawyer Mankun wants to share with everyone in this article.

China's Ban Does Not Prohibit Overseas Mining

First, let’s closely read the content of the notice from the National Development and Reform Commission regarding the rectification of virtual currency "mining" activities, which mainly involves the following points:

• A comprehensive review and inspection of virtual currency mining projects, including those that have been completed, are under construction, and abnormal electricity consumption monitoring;

• Strictly prohibit new project investments and construction, and take multiple measures to completely eliminate the possibility of new mining projects;

• Accelerate the orderly exit of existing projects, steadily rectify and phase out ongoing virtual currency mining projects.

It can be seen that the ban itself is only aimed at domestic virtual currency mining activities and does not restrict the option of going overseas for virtual currency mining. Therefore, based on the ban itself, there is no problem for Chinese citizens to establish mining farms overseas or participate in overseas mining activities.

*Image source: Knowledge popularization on the illegal nature of virtual currency "mining" behavior published by the Guangdong Provincial Development and Reform Commission

However, it is important to note that since virtual currency mining activities have been classified as an eliminated category in the "Guidance Catalog for Industrial Structure Adjustment" (2019 version), it falls under the category of "backward production technology and equipment." Therefore, even if one does not engage in mining activities, involvement in the production and sale of related equipment/products/technologies still violates Article 50 of the "Law of the People's Republic of China on Promoting the Circular Economy (2018 Revision)" and will face severe penalties. This is also one of the key reasons why domestic mining machine manufacturers are going overseas.

Additionally, the mined coins need to be sold. The notice issued by China in 2021 regarding “Further Preventing and Dealing with Risks of Virtual Currency Trading Speculation” strictly prohibits overseas virtual currency exchanges from providing trading services to Chinese citizens. Although there are still many ways to bypass IP restrictions for virtual currency trading, if any issues arise, such as frozen accounts due to dirty money or scams in OTC trading, users can only bear the risks themselves, as Chinese law does not support rights protection.

If you believe you can bear these risks and are determined to go overseas for mining, then the next question is crucial: Can Chinese citizens really participate in mining in those countries and regions where it is legal?

Can Chinese People Legally Participate in Overseas Mining?

Currently, there are overseas locations that are legal or clearly supportive and are popular mining destinations, such as Russia and Thailand. Here, Lawyer Mankun will take these two countries as examples to outline their regulatory frameworks for virtual currency mining and whether they allow Chinese citizens to participate legally.

Russia

In November 2024, Russia officially passed Bill No. 237585-8, which clarified the legal framework for virtual currency mining. The prerequisite for legal participation in virtual currency mining is: units registered as legal entities or individual entrepreneurs in Russia must submit the "Registration Form for Virtual Currency Mining Activities" to the Ministry of Digital Development, Communications and Mass Media of Russia and apply to the Federal Energy Department. Only after approval can they connect to the designated power grid. Additionally, individuals can also participate in mining activities, but only on a small scale within the government-set electricity consumption limit (not exceeding 6,000 kWh per month).

This bill does not explicitly limit the target audience to only Russian citizens, so theoretically, Chinese people can also go to Russia and legally participate in virtual currency mining. However, it is important to note that those who choose to go overseas for mining generally have a certain scale of mining machine clusters or farms, so it is recommended to first register as a legal entity or individual entrepreneur in Russia and then participate in virtual currency mining activities in compliance with regulatory requirements.

Currently, Russian law allows foreigners to register as legal entities or individual entrepreneurs locally, but certain conditions must be met. For example, when applying for individual entrepreneurship, one must have long-term residence in Russia or hold a residence permit; if choosing to establish a wholly-owned limited liability company (LLC) in Russia or joint venture with local residents/enterprises, one must provide a registered address in Russia and appoint at least one Russian executive (such as a director or general manager).

Thailand

Thailand's "Digital Asset Act of 2022" defines cryptocurrency mining as "digital asset services," which can be applied for by enterprises or individuals. The law requires that before starting virtual currency mining activities, a license must be obtained from the Thai Securities and Exchange Commission (SEC). Additionally, starting in 2025, enterprises engaged in virtual currency mining activities must use at least 50% renewable energy.

Similarly, the law does not specify nationality restrictions for the target audience, so Chinese people can also legally participate in mining activities in Thailand. Therefore, theoretically, the compliance items we need to consider include:

• If registered as a business, the registered capital must reach 100 million Thai Baht (approximately 20 million RMB) and pass anti-money laundering reviews. Additionally, business applications must rely on local partners, and foreign ownership is usually limited to 49%.

• If participating as an individual, the equipment power must be ≤10 kW, and the equipment information must be reported to the Ministry of Energy.

• Furthermore, the proceeds from mining must be exchanged for legal currency through compliant exchanges, otherwise, it may involve money laundering risks.

Summary by Lawyer Mankun

Can Chinese people legally mine overseas? After reading this article, I believe everyone has a general understanding.

However, Lawyer Mankun needs to remind everyone that policies are not set in stone. For example, in Russia, although virtual currency mining was opened in the second half of 2024, a bill passed on December 23, 2024, announced a complete ban on mining in 10 regions of Russia from January 2025 to March 2031, while 3 other regions will have partial mining restrictions during each heating season before 2031.

Therefore, even if going to countries and regions where virtual currency mining is legal, one must still clearly comply with local laws and regulations and remain sensitive to policy dynamics, avoiding any complacency.

Additionally, as mentioned by Lawyer Mankun earlier, virtual currency trading has not yet been protected by Chinese law. Moreover, even if cashing out overseas and bringing funds back to China, it will involve a series of regulatory issues including taxation and foreign exchange. Therefore, Chinese citizens should also take these factors into comprehensive consideration when deciding "whether to participate in mining."

In summary, the saying still holds: The Web3 market has risks, and investment requires caution.

/ END.

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