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Block reward mining rig maker Bitmain has been fined over $3.6 million by Chinese authorities over tax violations.

The State Taxation Administration in Beijing imposed the 25 million yuan ($3.63 million) fine on Bitmain on April 4, it said in a notice on its website. It alleges the company failed to meet last year’s personal income tax obligations.

The taxman further alleges that it sent a notice to Bitmain on its violations last August, but the company still failed to pay the 16.6 million yuan ($2.4 million) it owed in taxes. In particular, the tax agency cited violations of taxes relating to income from employees’ bonuses, salaries, allowances, and labor dividends.

Bitmain is the world’s largest manufacturer of application-specific integrated circuit (ASIC) chips that are used for block reward mining. It’s mostly known for its Antminer series of mining rigs dominating the BTC mining sector. Aside from the ASICs, the company operates BTC.com and Antpool, two of the largest BTC mining pools; the latter is the second-largest mining pool.

The tax fine on Bitmain further throws into question China’s treatment of digital assets. China has been against the sector for years, and in recent years, it has ramped up its anti-mining efforts. The country grabbed headlines when it booted hundreds of miners who fled to neighboring countries like Kazakhstan as others relocated to the United States.

Despite being based in Beijing, Bitmain announced in late 2021 that it would cease shipping its mining rigs to Chinese customers in line with the government’s stance against the block reward mining industry.

Meanwhile, despite the dip in mining profits and political campaigns against the industry in the U.S., Bitmain’s global business continues to thrive, with its latest device selling out in minutes last December.

Watch: Blockchain mining & energy innovation

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