After the arrest approval was issued, Li Qunnan, born in 1982, was widely described in market discussions as the chairman of a listed company who had allegedly misused RMB 50 million of company funds for Bitcoin mining.

However, after the relevant arrest approval decision was revoked, the previous claims regarding the alleged misuse of funds have changed significantly.

On March 25, 2023, Zhongchang Big Data Corporation Limited (600242.SH, hereinafter referred to as “Zhongchang Data” or “*ST Zhongchang”) announced that its director Li Qunnan had previously been placed under criminal investigation over suspected fund misappropriation. The Chaoyang District People’s Procuratorate of Beijing revoked the original arrest approval decision on January 11, 2023.

The decision marked a major turning point in an investigation that had lasted for more than a year. Before this, Li Qunnan had been investigated over related fund issues and was approved for arrest in June 2022. During the process, issues involving fund usage, server purchases, Bitcoin mining allegations, and corporate governance attracted significant market attention.

Li Qunnan’s Background and Role at Zhongchang Data

According to public information, Li Qunnan was born in April 1982. He graduated from Central South University with a bachelor’s degree in Mechanical Design and Automation. He previously served as CEO of Beijing Dianxin Times Network Technology Co., Ltd., and later worked as a director and general manager of Shanghai Yunke Network Technology Co., Ltd.

On February 20, 2020, Li Qunnan was elected chairman of the ninth board of directors of Zhongchang Data. At that time, the company introduced his professional background, noting his previous positions at Beijing Dianxin Times Network Technology Co., Ltd., Shanghai Yunke Network Technology Co., Ltd., and Zhongchang Data.

During this period, Zhongchang Data mainly focused on domestic and overseas digital marketing businesses. The company faced a relatively complex operating environment. Its 2020 annual report mentioned issues related to liquidity management and the need for the actual controller to fulfill relevant commitments and return funds in a timely manner.

While Li Qunnan served as chairman, disagreements occurred between company management and shareholders regarding board adjustments and business operations. In August 2021, Zhongchang Data changed its chairman, while Li Qunnan remained a company director.

Investigation Into Fund-Related Issues

In October 2021, during a review of its subsidiaries, Zhongchang Data stated that it had discovered suspected fund misuse and potential harm to company interests involving Li Qunnan during his management role at Shanghai Yunke Network Technology Co., Ltd. The company subsequently reported the matter to the authorities.

On November 30, 2021, Zhongchang Data announced that the Chaoyang Branch of the Beijing Municipal Public Security Bureau had officially filed a case on November 11, 2021. On June 1, 2022, the Chaoyang District People’s Procuratorate of Beijing approved the arrest of Li Qunnan.

Zhongchang Data stated that during the investigation, the company cooperated with public security authorities and procuratorial authorities and provided relevant evidence materials.

Bitcoin Mining Allegations and Server Purchase Discussions

During the development of the case, market discussions included claims that Li Qunnan had used RMB 50 million of company funds for Bitcoin mining. Because the names “Li Qunnan,” “Bitcoin,” and “Zhongchang Data” were frequently mentioned together, the allegation became one of the main reasons the case attracted public attention.

However, according to Zhongchang Data’s 2021 interim report, the company disclosed that its overseas subsidiary, Singapore Yunke Network Technology Co., Ltd., had used USD 3.25 million mainly to purchase server equipment. During the same period, the company’s fixed assets increased from approximately RMB 1.8 million to RMB 22.72 million. Zhongchang Data explained that the increase was mainly related to Singapore Yunke’s purchase of machinery and equipment.

Therefore, questions regarding whether the funds were used for Bitcoin mining, the specific purpose of the funds, and related responsibility should be evaluated based on company announcements, financial disclosures, and investigation results. Market discussions should not be treated as final conclusions without official confirmation.

Arrest Decision Revoked After Further Investigation

During the investigation, the Chaoyang District People’s Procuratorate of Beijing conducted further reviews of the case.

According to Zhongchang Data’s later disclosures, prosecutors identified areas requiring improvement in the company’s management of subsidiaries, related companies, and financial approval procedures.

The investigation materials indicated that some expenditures of Shanghai Yunke were processed through the financial department, where employees completed approvals and payments based on relevant instructions. Issues included overlapping responsibilities, unclear roles, and insufficient supervision during the approval process.

Prosecutors also noted that Zhongchang Data had shortcomings in supervising subsidiaries and related companies, and that the company’s management team needed to further improve legal awareness and corporate governance practices.

After further investigation, the Chaoyang District People’s Procuratorate of Beijing revoked the original arrest approval decision against Li Qunnan on January 11, 2023. The decision stated that Li Qunnan’s use of the relevant funds complied with company regulations and was recognized by the company.

On March 25, 2023, Zhongchang Data officially disclosed the update. The case, which went through criminal investigation, arrest approval, and later revocation of the arrest decision, became an important event related to the company’s management and governance.

Key Issues: Funds, Servers, and Bitcoin Mining

The main areas of market attention included whether funds had been misused, the actual purpose of server purchases by the overseas subsidiary, and whether those servers were related to Bitcoin mining.

Public information showed that Singapore Yunke purchased server equipment worth USD 3.25 million, while Zhongchang Data’s fixed assets increased during the same period. Since Bitcoin mining typically requires large amounts of computing equipment, some market participants linked the server purchases with Bitcoin mining activities.

However, based on currently available information, the relationship between server purchases, fund approvals, and Bitcoin mining should be understood according to company announcements, regulatory documents, and official investigation findings. Issues involving legal responsibility, fund usage, and corporate decisions should not be determined solely based on online discussions or individual media reports.

Conclusion

Following the revocation of Li Qunnan’s arrest approval, the understanding of the case from both legal and factual perspectives changed. For investors and the public, it is important to distinguish between market rumors, company disclosures, investigation findings, and information from different stages of judicial procedures.