Federal Judge Blocks Arkansas from Shutting Down Crypto Miner of Chinese Descent

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Ruholamin Haqshanas

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Ruholamin Haqshanas

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Ruholamin Haqshanas is a contributing crypto writer for CryptoNews. He is a crypto and finance journalist with over four years of experience. Ruholamin has been featured in several high-profile crypto...

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November 27, 2024

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A federal judge in Little Rock, Arkansas, has temporarily prevented state officials from shutting down a cryptocurrency mining operation owned by a U.S. citizen of Chinese descent.

On November 25, Chief U.S. District Judge Kristine Baker issued a temporary restraining order (TRO) in favor of Jones Eagle, a crypto-mining firm owned by Qimin “Jimmy” Chen.

The case revolves around two contentious state laws—Act 636 of 2023 and Act 174 of 2024.

Act 636 bars companies or individuals linked to the Chinese government from owning property in Arkansas, while Act 174 prohibits foreign entities from owning digital asset mining operations.

State Claims Owner of Jones Eagle is Chinese National

The state argued that Chen, the majority owner of Jones Eagle through Eagle Asset Holding, is a Chinese national and sought a permanent shutdown of the operation.

However, Chen, a naturalized U.S. citizen residing in New York, claimed the state’s actions amounted to illegal discrimination based on national origin.

He filed for the TRO to halt enforcement of the laws against him.

Judge Baker’s ruling puts the state’s actions on hold for 14 days.

During this period, a hearing will determine whether a preliminary injunction should extend the restraining order, barring Arkansas officials from intervening in the crypto mining operation.

Chen’s attorney, Alex Jones, welcomed the decision, stating it would protect his client while preparing to argue that the laws are unconstitutional and overreach legislative boundaries.

The legal dispute also highlights Chen’s efforts to comply with state regulations.

According to court filings, he provided documents to the Arkansas attorney general to prove that his mining operation was not on agricultural land—a key restriction under state law.

Chen also attempted to clarify his citizenship status with state officials but was denied a meeting.

“I have been investigating a number of crypto mining operations and simply seeking the facts, but not all entities have cooperated fully,”

Arkansas Attorney General Tim Griffin said.

Bitcoin Miners in Texas Required to Register

Last week, the Public Utilities Commission of Texas (PUCT) implemented a new regulation requiring Bitcoin miners connected to the Energy Reliability Council of Texas (ERCOT) grid to register and provide critical information about their operations.

The rule mandates miners to disclose their facilities’ locations, ownership details, and electricity demand to the state agency.

Under the regulation, Bitcoin miners must register within one working day of connecting to the ERCOT grid.

The registration must also be renewed annually by March 1.

Bitcoin miners failing to comply with the new requirements could face severe penalties.

Violators will be charged with a Class A violation, carrying fines of up to $25,000 per day.

The regulation comes amidst broader discussions about Texas’s role as a leader in cryptocurrency innovation.

Senator Ted Cruz, a vocal advocate for Bitcoin, has pledged to make Texas a haven for cryptocurrency businesses.

“I want Texas to be the oasis for Bitcoin and cryptocurrency,” he said in a recent interview. “We’re seeing miners and innovators from around the globe invest here and create new jobs.”