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Is it legal for Chinese citizens to participate in Virtual MoneyMining overseas?
This article is written by Iris, Lawyer Xu Xiaohui
When it comes to Web3 mining, I don't know if any of you have the same confusion as Mr. Mankiw: 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, China issued the "Notice of the State Development and Reform Commission and other departments on cracking down on virtual currency mining activities", explicitly prohibiting the development of virtual currency mining in any form. Since then, there has been a wave of miners going abroad, with a large number of mining farms moving to countries and regions such as Australia and Europe.
So, does going abroad mean you can rest easy?
Obviously, it's not very likely.
In 2022, regulatory agencies in countries/regions including Russia, the European Union, etc., have also begun to call for and take actions to ban energy-intensive cryptocurrency mining, with BTC mining being the first target. Just recently, on March 5, 2025, the Chinese Embassy in Angola shared a relevant article titled 'Reminder: Engage in virtual currency 'mining' in accordance with the law and regulations'.
Is it legal for Chinese citizens to go abroad to participate in virtual currency mining? https://img.gateio.im/social/moments-84d7a2174307c465b4408dcff57b01d6(
*Image Source: Announcement from the Chinese Embassy in Angola
The document pointed out that in April 2024, Angola introduced a ban on mining and began a sustained special operation to crack down on cryptocurrency mining activities within the country. In this operation, the Angolan authorities have uncovered several cases of Chinese citizens participating in virtual currency mining. In addition, a previous announcement from the embassy stated that cryptocurrency mining is a criminal activity, and anyone involved in mining, providing power for mining, or even storing related equipment, will face imprisonment ranging from 1 to 12 years upon investigation.
Here, someone may mention another fact: in 2024, Russia has already started supporting BTC mining, and other countries like Thailand have also been able to mine legally.
So, can Chinese people mine cryptocurrencies legally in those countries and regions that support cryptocurrency mining when they go abroad?
And this is precisely the core issue that Lawyer Mankiw wants to share with everyone in this article.
) Chinese ban does not prohibit offshore mining
First, we carefully read the contents of the 'Notice of the National Development and Reform Commission and Other Departments on Cleaning up the 'Mining' Activities of Virtual Currencies', which mainly involves the following points:
It can be found that the ban itself is only aimed at domestic virtual currency mining activities, and does not restrict the approach of going overseas to engage in virtual currency mining. Therefore, from the ban itself, there is no problem for Chinese citizens to set up mines overseas or participate in overseas mining activities.
Is it legal for Chinese citizens to participate in virtual currency mining abroad?
*Image source: Knowledge popularization on the illegal nature of virtual currency 'mining' behavior released by the Guangdong Provincial Development and Reform Commission
It should be noted that since virtual currency mining activities have been included in the "Guiding Catalogue for the Adjustment of Industrial Structure" (2019 Edition) for elimination, they fall into the category of "outdated production technology and equipment". Therefore, even if one does not engage in mining activities, but is involved in the production and sale of related equipment/products/technology, it still violates Article 50 of the "PRC Circular Economy Promotion Law of 2018 Amendment" and will be severely punished. This is also one of the key reasons why domestic mining machine manufacturers are increasingly going overseas.
Besides, the coins mined also need to be sold. The 'Notice on Further Preventing and Handling the Risks of Speculation in Virtual Currency Trading' issued by China in 2021 strictly prohibits overseas virtual currency exchanges from providing virtual currency trading services to Chinese citizens. Although there are still many ways to bypass IP restrictions for virtual currency trading, if any problems arise, such as freezing of funds related to illicit activities or being scammed in OTC trading, users can only bear the risks themselves as Chinese law does not support rights protection.
If you think you can bear all these risks and are determined to go mining overseas, then the key question is: Can Chinese citizens really enter with peace of mind in those countries and regions where mining is legal?
Can Chinese participate in overseas mining legally?
Currently, in overseas countries that are legal or clearly supportive and are popular mining destinations, such as Russia and Thailand. Here, Lawyer Mankun uses these two countries as examples to sort out the regulatory frameworks for cryptocurrency mining they have issued, to see if Chinese people can participate legally as well.
(# Russia
In November 2024, Russia officially established the legal framework for cryptocurrency mining through Bill No. 237585-8. The prerequisite for legally participating in cryptocurrency mining is that entities registered as legal entities or individual entrepreneurs in Russia must submit a "Registration and Record Filing Form for Cryptocurrency Mining Activities" to the Ministry of Digital Development, Communications and Mass Media of Russia, and apply to the Ministry of Energy for approval before being able to access the designated power grid. In addition, individuals can also participate in mining activities, but only on a small scale within the government-set limit for electricity consumption (not exceeding 6000 kWh per month).
The bill does not specify that the target is limited to Russian citizens, or it can also include foreign citizens. Therefore, theoretically, Chinese people can also go to Russia to legally participate in cryptocurrency mining. However, it is important to note that generally, those who choose to mine overseas have a certain scale of mining machine clusters or mining farms, so it is recommended to first register as a legal entity or individual merchant in Russia according to the requirements, and then participate in cryptocurrency mining activities in compliance with regulatory regulations.
Currently, Russian law allows foreigners to register legal entities or individual entrepreneurs locally, but certain conditions are required. For example, when applying for an individual entrepreneur as an individual, it is necessary to 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/businesses, it is necessary to provide a registered address in Russia and appoint at least one Russian national as a senior executive (such as a director or general manager).
)# Thailand
Thailand's "Digital Asset Act 2022" defines cryptocurrency mining as "digital asset services" and allows participation by enterprises or individuals. The Act requires a license to be obtained from the Securities and Exchange Commission (SEC) of Thailand before engaging in virtual currency mining activities. Additionally, from 2025 onwards, enterprises engaged in virtual currency mining activities are required to use at least 50% renewable energy.
Similarly, there is no clear restriction on the nationality of the target in the bill, so Chinese people can also legally participate in mining activities in Thailand. Therefore, theoretically, the compliance items we need to consider include:
( Lawyer Mann's Summary
Can Chinese people mine legally overseas? I believe that after reading this article, everyone has a rough idea.
However, lawyer Mankun needs to remind everyone that policies are not set in stone. Take Russia, for example. Although it opened up cryptocurrency mining in the second half of 2024, a law passed on December 23, 2024, announced that 10 regions of Russia will completely ban mining from January 2025 to March 2031, while three other regions will restrict mining during each heating season before 2031.
Therefore, even if you go abroad to countries and regions where virtual currency mining is legal, you still need to clearly comply with local laws and regulations, and keep sensitive to policy dynamics, never harbor any lucky mentality.
Furthermore, as mentioned by Lawyer Mankiw in the previous text, the trading of virtual currencies is not yet protected by Chinese law. At the same time, even if cashed out overseas and funds flow back to China, it will involve a series of regulatory issues including taxation, foreign exchange, etc. Therefore, Chinese citizens should also take these factors into account in the comprehensive consideration of "whether to participate in mining".
In any case, the bottom line is: the Web3 market is risky, so investment needs to be cautious.
/ END.