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The White House has ordered a Chinese group that runs a crypto-mining operation in Wyoming to sell the land where it keeps its servers because the facility is next to a base that houses US nuclear ballistic missiles.
President Joe Biden ordered MineOne Partners and its partners to sell the land next to Warren Air Force Base in Wyoming within 120 days. He said the British Virgin Islands group was majority-owned by Chinese nationals and had not informed the US government about the sensitive transaction.
The US military deploys Minuteman III nuclear intercontinental ballistic missiles at the Warren base in south-east Wyoming. In the divestiture order issued on Monday, Biden said MineOne used specialised equipment for cryptocurrency mining that included foreign-sourced technology, which posed a national security risk.
“The proximity of the foreign-owned real estate to a strategic missile base and key element of America’s nuclear triad, and the presence of specialised and foreign-sourced equipment potentially capable of facilitating surveillance and espionage activities, presents a national security risk to the US,” Biden said in the order.
The move comes as Congress becomes increasingly concerned about Chinese groups buying agricultural and other land across the US, particularly near military installations. It also comes one year after an American fighter jet shot down a suspected Chinese spy balloon off the US east coast. The balloon had hovered over a nuclear missile facility in Montana during a more than weeklong flight over North America.
“This has been a decades-long conflict between Chinese investors and the security community,” said Ivan Schlager, an expert on national security law at Kirkland and Ellis, adding that there were similar cases across the US. “Are they a coincidental investment opportunity or something more strategic?”
The Chinese embassy in Washington said it was not aware of the case, but Liu Pengyu, its spokesperson, said: “Overstretching the concept of national security and politicising economic, trade and investment issues runs counter to the principles of market economy and international trade rules, in addition to undercutting international confidence in the US market environment.”
The White House said MineOne bought the land in June 2022 without notifying the Committee on Foreign Investment in the US, the inter-agency panel that vets deals for security concerns.
Cfius started investigating the deal after receiving a tip from the public. Biden ordered a divestiture after the panel concluded it was not possible to complete a mitigation agreement to address the security concerns.
The presidential order requires MineOne to remove its equipment from the land within 90 days. It also immediately barred the group and its partners from accessing the location — except for the purposes of moving the equipment — until Cfius was satisfied that all the equipment was gone.
The case is the latest example of tensions between the US and China over national security issues. It comes as the two countries continue efforts to stabilise relations that hit rock bottom last year.
But US officials have repeatedly stressed that the Biden administration will not hold back from taking punitive actions in cases where they believe China, or Chinese companies, pose a national security threat.