News came that the North African country of Libya has captured 50 Chinese crypto miners and dismantled large mining equipment. As someone who has experienced two cycles of bull and bear markets, what I see is not an isolated incident but the prologue to a global regulatory crackdown.
When a country like Libya, which is not at the forefront of crypto regulation, begins to crack down on mining operations, the signal released is unmistakable: crypto mining is becoming a target for law enforcement globally. This is not just a regional event but a reflection of the global shift in regulatory sentiment.
I clearly remember that when China completely banned mining in 2021, many miners still held the illusion of 'moving overseas for safety.' Now, the case in Libya has shattered this illusion, and the compliance risks of mining are sharply rising globally.
01 Regulatory winter: From China to Libya, the global crackdown on miners has become a trend
The particularity of this action in Libya is that it is not an isolated case. Since the joint notice issued by the National Development and Reform Commission and other departments in China in September 2021 (regarding the rectification of virtual currency 'mining' activities), which listed mining as an eliminated industry, the global regulatory stance has clearly shifted to a severe one.
Court cases in search results indicate that contracts for purchasing mining machines may be deemed invalid. For example, in a sales contract dispute adjudicated by the Jingde County People's Court, the defendant was ordered to return the payment, but it was clearly stated that the contract for purchasing 'mining machines' for 'mining' was invalid due to violating public order and good customs.
More concerning is that mining activities may violate multiple laws. According to the risk warning issued by the Datong Public Security Bureau, mining may derive various crimes such as leading organized pyramid schemes, illegal fundraising, damaging computer information systems, and fraud.
The latest information from December 2025 shows that seven major associations jointly issued a risk warning, clearly indicating the risks associated with illegal activities related to virtual currencies. This indicates that the regulatory stance has not relaxed.
02 Risk escalation: Multiple dilemmas and legal traps faced by miners
The Libyan case reveals a cruel reality: miners not only face the risk of being investigated but may also fall into various legal traps.
First, the risk of contract invalidity. Current judicial practice has clarified that sales contracts and investment contracts involving 'mining' may be deemed invalid due to violating public order and good customs, and participants must bear their own losses.
Second, the risk of equipment confiscation. Whether it's the confiscation of equipment during the Libyan operation or the confiscation of mining machines when domestic police crack down on 'mining' dens, miners' investments may be completely lost.
Third, the risk of derived crimes. The anonymity of virtual currencies makes them easy tools for money laundering, illegal asset transfers, and other illegal activities, and miners may inadvertently get caught up in more serious legal issues.
Mining has transformed from a technological adventure into a legal minefield. As pointed out by a judge from the Beijing Pinggu Court, virtual currency 'mining' activities have been designated as a nationally mandated eliminated industry, and related investments are not protected by law.
03 Market impact: Future trend analysis under tightened regulation
From a market perspective, the Libyan incident has released two important signals:
On one hand, the global compliance costs for mining will significantly increase. Miners can no longer rely on 'loopholes' to gain profits and must face an increasingly stringent global regulatory environment. This will directly lead to increased mining costs and may further raise the production costs of cryptocurrencies like Bitcoin.
On the other hand, the trend of mining centralization may accelerate. Only large institutions with a high degree of compliance and good communication with regulatory bodies may continue to operate, while small miners will gradually be eliminated from the market.
It is worth noting that despite the strict restrictions on mining activities, Grayscale predicts in its 2026 outlook that Bitcoin prices may reach an all-time high in the first half of 2026. This indicates that the market is adapting to the new regulatory environment, and there is not a simple negative correlation between mining regulation and asset prices.
04 Survival guide: How to avoid risks in an era of strong regulation
In the face of a global regulatory crackdown, I recommend adopting the following strategies:
Completely avoid illegal mining activities. Not only in China, but also in some overseas regions with unclear regulations, participation should be avoided. Police reminders emphasize the need to be vigilant about the criminal risks derived from virtual currency 'mining' activities.
Pay attention to compliant cryptocurrency investment channels. Compliant products such as cryptocurrency ETPs mentioned in the Grayscale report may become mainstream investment channels in the future. Although they do not directly participate in mining, they can share the industry development dividends.
Prioritize completely compliant blockchain fields. Asset tokenization and the application of blockchain technology in supply chain management and other fields may be more sustainable.
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