Uncovering businessman Lin Qingxing: rumored to have 100,000 bitcoins, closely related to fallen vice-ministerial official Xiao Yi

Author: Dong Yujia, Xu Cihao, Blockchain Daily

The civil ruling of the Supreme Court (2021 Supreme Court Civil Application No. 3002) pointed out that the establishment of the Fuzhou data center involved in the case and the custody and operation of the equipment were essentially behaviors of using equipment for high-performance computing to obtain virtual currency rewards, which is a high-energy-consuming industry not encouraged by the state.

On November 13, the official website of the Central Commission for Discipline Inspection and the National Supervisory Commission announced that Xiao Yi, former member of the Party Leadership Group and Vice Chairman of the Jiangxi Provincial Political Consultative Conference, was expelled from the Party and public office for serious violations of discipline and law.

The announcement stated that Xiao Yi abused his power to introduce and support enterprises engaged in virtual currency "mining" activities that do not comply with national industrial policy requirements, illegally borrowed money for projects and construction, causing a negative impact.

Xiao Yi became the first deputy ministerial-level official in the country to fall due to virtual currency.

According to reporters from Blockchain Daily, the direct trigger for Xiao Yi's downfall was his introduction of Fuzhou Genesis Technology Co., Ltd. during his tenure in Fuzhou, which, under the guise of big data, was actually mining Bitcoin. Moreover, Xiao Yi personally engaged in numerous illegal activities throughout the process, and his relationship with the company's owner, Lin Qingxing, a businessman from Fujian, was particularly close.

The announcement from the Central Commission for Discipline Inspection also pointed out that Xiao Yi colluded with illegal private entrepreneurs for personal gain, using his position to benefit others in terms of job promotions, project contracting, and project development, and illegally accepted huge amounts of money and property.

So, who is Lin Qingxing? What kind of company is Fuzhou Genesis?

Xiao Yi Personally Went to Germany for Introduction

Public information shows that Fuzhou Genesis Technology Co., Ltd. (hereinafter referred to as "Fuzhou Genesis") was established on June 23, 2017, and signed a contract with the Fuzhou High-tech Zone government to settle in the Senhong Technology Industrial Park on the same day. Its registered capital is 10 million yuan, with Xu Zhijie as the legal representative holding 95% of the shares, and another shareholder, Lin Fang, holding 5%.

The company is a Sino-foreign joint venture established with German Genesis Mining (GM Company) as the investor and Lin Qingxing as the technical partner, mainly investing in the construction of the "Fuzhou Genesis Supercomputing Center." GM Company is a mining enterprise founded in 2013 that provides computing power hosting services to global customers.

Xiao Yi served as the Secretary of the Fuzhou Municipal Committee from April 2015 to March 2021. Reporters from Blockchain Daily noted that during his tenure, Fuzhou Genesis was a key enterprise and received significant attention.

For example, the notice issued by the Fuzhou Municipal Government Office mentioned that the construction project of the Genesis Supercomputing Center undertaken by Fuzhou Genesis is one of the key projects for the digital economy in Fuzhou.

The three-year action plan also included a list of key digital economy projects in Fuzhou (first batch). Among them, the construction period of the Genesis Supercomputing Center is from 2019 to 2022, with a total investment of 23 billion yuan, making it the project with the highest investment amount on the list, 4.6 times that of the second place.

At the same time, Fuzhou Genesis successfully made it onto the list of 2020 Jiangxi Province's big data demonstration enterprises published by the Jiangxi Provincial Department of Industry and Information Technology.

According to Xinhua News Agency, when the person in charge of Fuzhou Genesis was initially selecting a site in 2017, he proposed two conditions for settling in Fuzhou: first, to provide more than 150,000 square meters of standard factory buildings in one go; second, to set up a 200,000-volt double-circuit power supply within a month.

The original report from Xinhua stated: "Upon receiving the news, Fuzhou immediately convened the heads of the high-tech zone, power supply, and other departments for discussion. Fuzhou Mayor Zhang Hongxing said that after careful evaluation, they agreed to the enterprise's conditions the next morning, and worked overtime to set up the power supply equipment in just 28 days."

In order to establish the Genesis Supercomputing Center, Xiao Yi personally took charge and even led a team to Germany.

In December 2017, Xiao Yi led a delegation to Germany to help Fuzhou High-tech Zone and Fuzhou Genesis sign a tripartite framework agreement with GM Company for the construction of the supercomputing industry center, which would install 500,000 servers in Fuzhou and put them into operation. In September 2020, Xiao Yi also conducted in-depth research at the construction site of the Fuzhou High-tech Data Center (Genesis Supercomputing Center) and the digital block.

Genesis and GM in Court

From the disciplinary announcement by the Central Commission for Discipline Inspection and reports from authoritative media, it can be seen that the Fuzhou Genesis Supercomputing Center, which Xiao Yi strongly supported, ultimately became a virtual currency mining center.

This was also confirmed in the judgment document published by the Supreme Court. Lin Qingxing's Fuzhou Genesis eventually took GM Company to court, and the case reached the Supreme Court. The civil ruling of the Supreme Court (2021 Supreme Court Civil Application No. 3002) stated that the establishment of the Fuzhou data center involved in the case and the custody and operation of the equipment were essentially behaviors of using equipment for high-performance computing to obtain virtual currency rewards, which is a high-energy-consuming industry not encouraged by the state.

The ruling document noted that in September 2018, Fuzhou Genesis and GM Company had a dispute over electricity fees, and the former unilaterally stopped reporting data and sending fee lists to the latter.

In May 2019, GM Company filed a lawsuit with the Fuzhou Intermediate People's Court, requesting Fuzhou Genesis to return the 560,000 GPUs and 60,580 AntMiner S9 Bitcoin ASIC miners it had entrusted for custody.

The focus of the dispute between the two parties was whether Fuzhou Genesis should return the equipment involved in the case.

The case was heard on June 29, 2020, at the Fuzhou Intermediate People's Court, and subsequently, Fuzhou Genesis applied for a retrial at the Jiangxi Provincial High Court.

The Jiangxi Provincial High Court ruled that Fuzhou Genesis should return 100,000 GPUs to GM Company's mainland subsidiary and 385,681 GPUs to GM Company's entity in Hong Kong.

Fuzhou Genesis submitted new evidence to the Supreme Court and applied for a retrial, but it was ultimately rejected.

The civil ruling of the Supreme Court (2021 Supreme Court Civil Application No. 3002) stated: "GM Company, as the contracting party, enjoys the statutory right to terminate the contract… GM Company has the right to claim the return of the equipment, and the equipment involved is still in operational use, meeting the conditions for return. The original judgment ordering Fuzhou Genesis to return the equipment to GM Company is not improper."

Reporters from Blockchain Daily sent an email to GM Company inquiring whether Fuzhou Genesis had returned the equipment, but as of the time of publication, no comment had been received.

However, sources close to the core of the case revealed to reporters that the equipment had been returned. Additionally, the tens of thousands of Bitcoins mined by the Fuzhou Genesis Supercomputing Center became another focal point of contention between the two parties.

During the dispute between GM Company and Fuzhou Genesis, while waiting for the court hearing, the progress of the Genesis Supercomputing project (Phase III) continued.

According to an announcement released by the Fuzhou Municipal Bureau of Industry and Information Technology on November 7, 2019, it stated: "The Fuzhou Genesis project is progressing smoothly, with a total investment of 5 billion yuan for Phase III, and it is expected that all supporting projects will be completed by April 2020, with operations starting in May 2020."

However, reporters were unable to find out whether the supercomputing project is currently in operation. Nevertheless, the Phase I and Phase II projects were fully completed and put into operation during the Phase III construction stage. It is reported that the supercomputing center's Phase I and Phase II projects used 11 factory buildings in the Senhong Technology Industrial Park for the data center, covering an area of 170,200 square meters, with a total of 160,000 operational servers.

In addition, reporters from Blockchain Daily logged onto the official website of the Fuzhou High-tech Zone government and searched for "Fuzhou Genesis Technology Co., Ltd." as a keyword, finding that the latest update was on March 8, 2021, where relevant company personnel and some employees participated in a seminar on the construction of the Fuzhou High-tech Zone Human Resources Public Service Platform.

Reporters attempted to contact the relevant leaders of the Fuzhou Municipal Government, Fuzhou High-tech Zone government, Economic and Science Bureau, and publicity department regarding the latest developments and related businesses of Fuzhou Genesis, but received no responses. Meanwhile, the company's phone was also unanswered.

Lin Qingxing and His Company

As a wealthy businessman personally introduced by the Secretary of the Municipal Committee, Lin Qingxing, the actual controller of Fuzhou Genesis, became a "guest of honor" in the local area.

When reporters from Blockchain Daily searched again using Lin Qingxing as a keyword on the official website of the Fuzhou High-tech Zone government, they found a notice published on October 14, 2021, stating that Lin Qingxing, elected from Jinxian, was suspected of serious violations of law and requested to resign from his position as a representative of the Fuzhou Municipal People's Congress. However, the announcement did not specify what laws he had violated. (Note: Jinxian is a county under Fuzhou.)

In addition to being elected as a representative of the Fuzhou Municipal People's Congress, Lin Qingxing also received the Jiangxi Province May Day Labor Medal.

According to an article published by the Fuzhou Federation of Trade Unions on April 29, 2019, titled "[Model Worker Style] Jiangxi Province May Day Labor Medal Winner - Lin Qingxing," Lin Qingxing was born in 1989, holds a master's degree, and has achieved innovative results in distributed information services and integration technology, as well as key technologies in grid computing.

The article stated: "He is currently the director of the Fuzhou Genesis Green Data Center Technology Application Research Institute, CEO of Fuzhou Genesis Technology Co., Ltd., CEO of Putian Jiumu Technology Co., Ltd., and CEO of Putian Genesis Technology Co., Ltd., and is the actual controller of Fuzhou Genesis, Putian Genesis, and Putian Jiumu Technology, recognized in the industry as an evangelist for distributed supercomputing architecture experience."

Reporters from Blockchain Daily found that Lin Qingxing is also the legal representative of Fuzhou Tang Xianzu Cloud Computing Technology Co., Ltd. and Jiangxi Jiumu Technology (Group) Co., Ltd. Notably, Fuzhou High-tech Zone Financial Investment Group Co., Ltd. (with the Fuzhou High-tech Industrial Development Zone Finance Bureau as a shareholder) is one of the shareholders of the former, investing 600 million yuan for a 40% stake, and increased its investment by 200 million yuan on March 19 this year.

Both Fuzhou Tang Xianzu Cloud Computing Technology Co., Ltd. and Jiangxi Jiumu Technology (Group) Co., Ltd. are primarily engaged in internet data services and cloud computing equipment services.

At the same time, Lin Qingxing also registered a company in his hometown in Fujian, attempting to replicate his "Fuzhou model." In November 2017, Putian Genesis Technology Co., Ltd. was officially registered, with a registered capital of 1 billion yuan, and Lin Qingxing holding 95% of the shares. On December 28 of that year, Putian Genesis won a plot of land in Huangshi Commercial Logistics Park for 118 million yuan.

According to a report from the Putian Municipal Party Committee's official newspaper, "Meizhou Daily," in December 2019, the Putian Genesis Supercomputing Data Center project covers an area of approximately 171 acres, with plans to deploy 480,000 supercomputing servers and a total investment of approximately 20-26 billion yuan.

Reporters from Blockchain Daily learned from multiple independent sources that Lin Qingxing is from Fujian, has a keen business acumen, and entered the cryptocurrency space early, with industry rumors suggesting he owns over 100,000 Bitcoins. Currently, in addition to Xiao Yi being investigated, Lin Qingxing has also been dealt with by the law in a separate case.

Overview of Lin Qingxing's Actual Controlling Enterprises

Other Mining Enterprises in Fuzhou

Reporters from Blockchain Daily noted that during Xiao Yi's tenure, in addition to Fuzhou Genesis, several other companies involved in virtual currency mining also settled in Fuzhou.

On January 18, 2019, Fuzhou Xinghe and Bainen Wealth Investment Co., Ltd. jointly invested 16.8 million US dollars to establish Fuzhou Bainen Cloud Technology Co., Ltd., with Xu Zhijie as the legal representative. Xu Zhijie is also the legal representative of Fuzhou Genesis.

According to media reports, Bainen Wealth Investment Co., Ltd. is a wholly-owned subsidiary of Hong Kong-listed Bainen Group, which is a shadow stock of Nvidia, and the joint venture established with Fuzhou Xinghe is engaged in graphics card mining.

On November 11, 2021, the property preservation case of Fuzhou Yundong Network Technology Co., Ltd. and Fuzhou Xinghe Cloud Technology Co., Ltd. was officially accepted by the Linchuan District People's Court of Fuzhou. Notably, according to public information, Fuzhou Yundong Network Technology Co., Ltd. is engaged in virtual currency Filecoin mining-related business.

In addition, Jiangxi Xingchi Network Technology Co., Ltd. has property preservation and service contract disputes with Lin Qingxing's Fuzhou Tang Xianzu Cloud Computing Technology Co., Ltd. Jiangxi Xingchi Network Technology Co., Ltd. is the operating center for virtual currency Filecoin in Jiangxi, and Xiao Yi visited the Jiangxi headquarters of the Interstellar Alliance during his tenure as Secretary of the Fuzhou Municipal Committee.

In December 2020, the Interstellar Alliance completed nearly 100 million yuan in Series A financing, with investors including the Fuzhou High-tech Zone Industrial Fund.

Chairman of the Interstellar Alliance, Fang Jun, accompanied then-Secretary of the Fuzhou Municipal Committee, Xiao Yi, to visit the Interstellar Alliance · Jiangxi Big Data Headquarters

However, on November 6 of this year, the Xuzhou Public Security Bureau disclosed information about a concentrated and unified crackdown operation codenamed "2021 Hanfeng No. 3" on its official website. The Fengxian Public Security Bureau arrested 31 members of the Interstellar Alliance's network pyramid scheme in Shanghai, Wuhan, Shenzhen, and other places, seizing virtual currencies such as Ethereum, Tether, and FIL worth approximately 400 million yuan.

At the same time, reporters from Blockchain Daily learned from reliable sources that Fang Jun, the founder and chairman of the Interstellar Alliance, has been taken away by the Xuzhou police for investigation.