Author: Nicky, Foresight News
On June 11th, Caixin published an article titled 'How a Female Crypto Mogul Was Swindled of $60 Million in the U.S. – The Setup by the "Middle Eastern Royalty" Brothers'. Following the clues in the article, we investigated the storied career of this "female crypto mogul," Lyu.
According to Caixin, a female cryptocurrency tycoon from China was the victim of an investment fraud in the United States, losing over $9.4 million (approximately RMB 60 million). The individual is the CEO of a computing power technology company in southwestern China, Lyu, whose mining pool was reportedly once responsible for about 9% of the global Bitcoin hash rate at its peak.
The report states that two brothers named Zubair, who claimed to have "Middle Eastern royal" backgrounds, carried out the fraud by forging identities. One claimed to be a "son-in-law of Middle Eastern royalty," asserting control over family funds from the Middle East, international business connections, and local government resources in the U.S.; the other emulated a character from the TV series "Billions," posing as a hedge fund manager. They also successfully contacted and influenced Michael Smedley, the then-chief of staff to the mayor of East Cleveland, Ohio, ultimately inducing Lyu to sign a cryptocurrency mining farm development contract.
The Lyu in the report is an 80s-born female boss named Fiona Lyu. The company she founded, Chengdu Valarhash Technology Co., Ltd., operates two mining pools: 1THash and Bytepool.
According to Caixin, Fiona Lyu was born in Ningbo in the 1980s. Before entering the cryptocurrency industry, her life trajectory had no connection to finance or technology. In her early years, she worked in international trade and later started a custom tour group business. She is an avid outdoor traveler, diver, and sailing enthusiast. In a 2020 interview, she mentioned that from 2008 to 2018, she spent more than half of each year traveling, visiting places all over the world.
According to a previous TokenInsight report, she accidentally encountered Bitcoin in 2013 and immediately dove headfirst into this emerging industry. At that time, China's cryptocurrency mining industry was still in its early stages, and miners had to venture deep into the mountains of southwestern China to find cheap hydropower resources. Lyu recalled that she was among the first groups to "search for electricity" in Sichuan. "The conditions were very tough back then, but electricity was cheap, profits were high, and everyone was very excited."
In 2016, she began formally building her own mining farm; from 2017 to 2018, she transitioned to mining machine distribution; in July 2019, she established Chengdu Valarhash Technology Co., Ltd., serving as CEO, consolidating the business into a comprehensive platform integrating mining pool operation, mining farm construction, mining machine hosting, and computing power trading. In December of the same year, the company held a new product launch event in Chengdu, officially introducing the 1THash and Bytepool mining pool brands and the 1TMine computing power contract trading platform.
During its peak in the first half of 2020, 1THash ranked 7th globally among Bitcoin mining pools, and Bytepool ranked 11th. Combined, the two pools controlled about 9% of the global Bitcoin hash rate. This was a staggering figure at the time, meaning that for every 100 Bitcoins generated globally, about 9 flowed into her mining pools.
A Single Ban and a Turn of Fate
On May 21, 2021, the Financial Stability and Development Committee of the State Council held its 51st meeting, explicitly calling for "cracking down on Bitcoin mining and trading behavior."
In mid-June, the Sichuan Provincial Development and Reform Commission and the Sichuan Provincial Energy Bureau jointly issued a notice requiring power generation companies to self-inspect and self-correct, and to immediately stop supplying electricity to virtual currency "mining" companies. For miners in Sichuan, this was the most fatal blow. Sichuan was the largest mining hub in China, with hydropower prices during the rainy season as low as 0.2-0.3 RMB per kilowatt-hour, making it one of the cheapest power sources in the world.
According to Caixin, Lyu later told friends that it was a period of "extreme anxiety." Her company had nine data centers distributed across China, the United States, Canada, Russia, Sweden, and other locations, but several large mining farms in China were the core source of computing power. "Overnight, thousands of mining machines were forced to shut down, hundreds of shipping containers were waiting to be transported out, and money was burning every single day."
Image Source: Caixin
She ultimately chose the United States as the first stop for her overseas expansion. However, when she traveled across the ocean with hundreds of containers of mining machines, searching for a new foothold in Ohio, what awaited her was an elaborately orchestrated scam.
According to Caixin, in July 2021, through an intermediary, she met Zubair Al Zubair, a man who claimed to be a "son-in-law of UAE royalty" and asserted control over Middle Eastern family funds and local U.S. government resources. Zubair recommended to her an industrial property in East Cleveland, Ohio—the Nela Park—claiming it could provide electricity at a low rate of $0.04 per kilowatt-hour.
On August 11, 2021, inside the East Cleveland City Hall in Ohio, a seemingly formal signing ceremony took place. Witnessed by then-Mayor Brandon King and other city officials, Lyu signed her name on a cryptocurrency mining farm development contract, full of hope. She paid $3 million to Zubair's company, "Dubai Bridge," and wired the first $1 million from a Hong Kong account.
Image Source: Caixin
However, this was just the beginning of an elaborately planned scam. In reality, Zubair and his younger brother, Muzamil, were native-born Americans with no relation to any Middle Eastern royalty. The older brother's claimed identity as a "son-in-law" was completely fabricated; the younger brother's purported title of "hedge fund manager" was self-taught through watching YouTube videos and the TV series "Billions."
During subsequent interactions, Zubair established a "close personal relationship" with Lyu. In Lyu's view, this relationship had a romantic nature. Prosecutors later pointed out that such personal relationships were part of Zubair's fraud pattern, aimed at lowering the victim's likelihood of questioning his claims.
The scam ultimately cost Lyu over $9.4 million (approximately RMB 60 million), including contract payments and 1,067 mining machines (sold for $6.17 million) that were later deceived away by Zubair's brother and resold in Canada. And that signing ceremony in the mayor's office was nothing more than a false endorsement obtained by Zubair through bribing the mayor's chief of staff, Michael Smedley.
In May 2026, the U.S. Department of Justice announced the verdict: Zubair was sentenced to 24 years in prison, Muzamil to 23 years, and Smedley to 8 years. Lyu appeared in the case under the code name "Victim 2."
Another Lawsuit Back Home
While entangled in the U.S. scam, Lyu was simultaneously facing another legal dispute in China—a lawsuit with Shanghai Jincai Network Technology Co., Ltd., a subsidiary of the A-share listed company ST Zhongchang (600242.SH).
Image Source: Shanghai Securities News
According to earlier reports by Economic Observer and Jiemian News, the trigger for the incident was Li Qunan, the then-chairman of ST Zhongchang. Between January and September 2021, Li was suspected of misappropriating listed company funds to purchase Bitcoin mining machines and pay related hosting fees, totaling as high as 53.5472 million RMB. Among these, the company spent 30 million RMB purchasing servers (Bitcoin mining machines) from Chengdu Valarhash. These purchases were disclosed in the 2021 interim report as "company fixed assets used for actual operations," but audits revealed that the related payments did not actually form assets on the company's books.
Against this backdrop, ST Zhongchang's new management, seeking to recover losses, sued Chengdu Valarhash in the name of Shanghai Jincai in April 2022, demanding the termination of the 'Computing Power Service Contract' signed by both parties on April 1, 2021, and the return of the contract price of 19.2965 million RMB.
In October 2022, the Chengdu High-Tech Industrial Development Zone People's Court issued a first-instance judgment: the contract was deemed invalid because it involved Bitcoin "mining" activities, and Chengdu Valarhash was ordered to refund 19.2965 million RMB within ten days. The company appealed, and the second instance upheld the original judgment.
This lawsuit, from filing to final judgment, proceeded almost simultaneously with Lyu's victimization in the United States. On one side was a loss of $9.4 million overseas, and on the other was a court-ordered refund of nearly 20 million RMB in contract payments domestically. Under this dual blow, the "Mining Queen" who once controlled 9% of the global Bitcoin hash rate entered the darkest moment of her life.
