The Block: Chinese police arrest former Bitmain employee, who is now CEO of its rival MicroBT

Police in China have arrested Yang Zuoxing, a former employee of cryptocurrency mining chips manufacturer Bitmain and the current CEO of its rival MicroBT, the maker of WhatsMiner bitcoin miners.

Chinese news outlet BlockBeats reported the news Friday, citing “insiders,” who include Chinese cryptocurrency miners and exchanges. Yang has reportedly been taken into custody over a dispute involving the intellectual property rights of Bitmain.

Yang, who was one of the engineers responsible for designing Bitmain's leading miners, left the company in June 2016 after being denied an equity stake by Bitmain co-founder Micree Zhan.

Soon after leaving Bitmain, Yang founded MicroBT and was sued by Bitmain over patent rights. A court in China ultimately revoked Bitmain’s patent "on grounds that the circuit designs in question were widely used," according to a 2018 report by Bloomberg .

The arrest of Yang appears to be a re-opening of the Bitmain-MicroBT case. Bitmain had initially demanded damages of 26 billion yuan ( ~$3.7 billion) from MicroBT but later reduced the claim to $380,000, according to a CoinDesk report .

Earlier this year, Bitmain also reportedly sued another three former employees who started mining pool Poolin, seeking $4 million in damages. Bitmain alleged that the three violated their non-compete agreements.

The company is currently also going through a tiff with Micree Zhan, who was abruptly ousted from the company last week. Zhan said that he is going to take legal action to return to the firm.