Chinese Police Investigate Ex-Bitmain Employee for Bitcoin Miner IP Theft

Bitcoin Analysis
  • Yang Zuoxing, CEO at MicroBT, is under investigation by the local police.
  • The investigation is allegedly related to a dispute over Bitmain’s intellectual property rights.
  • Yang nor MircroBT have released an official statement.

A former Bitmain employee, Yang Zuoxing, is under investigation by the local police in China. The case appears to be related to a dispute involving the intellectual property rights of the mining giant corporation.

Open Investigation

According to a report by the Chinese news outlet BlockBeat, Yang Zuoxing, the CEO at MicroBT, has been taken into custody by local police to assist in an open investigation that involves tens of millions of dollars. BlockBeat stated that the arrest of Yang is directly related to the production of crypto mining hardware citing insider information,

The news outlet wrote:

The risk of starting a business in the mining circle is very high. Not only must the company be prevented from being arrested by the old club.

The History Behind Yang and Bitmain

Yang was one of the leading engineers at Bitmain. He helped design the company’s crypto mining gear, including the Antminer S7 and the S9. He left the firm in June 2016 after its co-founders, Jihan Wu and Micree Zhan (the latter now forced out of Bitmain), declined his request for a stake of the business. A few months later, Yang started his own crypto mining chip company, dubbed MircoBT. At the time, he claimed that his hardware was as good, if not better than Bitmain’s.

Yang stated:

MicroBT’s flagship Whatsminer M10 can deliver better power efficiency than Bitmain’s S9i [and we are working] on upgrades to stay competitive as Bitmain rolls out new products. Their technology is great, but ours is too.

Soon after Yang created his company, Bitmain filed a lawsuit against him over patent rights. However, China’s State Intellectual Property Office (SIPO) dismissed Bitmain’s patent due to a lack of unique creativity in Antminer’s design.

According to SIPO:

If a technological solution sought by a patent has different characteristics than existing technologies, but such difference is public knowledge, then it is obvious the solution would incorporate this public knowledge.

At the moment, it is not clear why Yang is under investigation by the local police in China. But, it seems to be related to the dispute over intellectual property infringement that Bitmain and MicroBT had. The current controversy adds up to the civil war happening at Bitmain where its co-founders are fighting to gain full control over the company.

This article was edited by Samburaj Das.

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