Bitmain files for an IPO with the U.S. SEC following a run-in among the co-founders

Bitmain files for an IPO with the U.S. SEC following a run-in among the co-founders
Written by:
Michael Harris
31st October 2019
Updated: 11th March 2020
  • Bitmain is seeking IPO with the U.S Securities and Exchange Commission (SEC).
  • Bitmain's co-founder and executive director, Ketuan Zhan, has been ousted by chairman, Jihan Wu.
  • Bitmain hired former Nasdaq China representative, Zheng Hua, to up its chances of the U.S. listing.
  • Bitmain launched the world's largest bitcoin mining farm in Texas last week.

Bitcoin mining equipment manufacturer, Bitmain Technologies Inc., has reportedly filed for an IPO (initial public offering) with the U.S. Securities and Exchange Commission (SEC), after its attempt to file for the same on the Hong Kong Stock Exchange (HKSE) failed in 2018, as regulators in Hong Kong weren’t sure of its sustainability.

Bitmain’s Biggest Shareholder Ousted By Chairman Jihan Wu

The report followed the ousting of Bitmain’s co-founder and executive director, Micree Ketuan Zhan, on Tuesday, by the company’s other co-founder and chairman, Jihan Wu. Zhan was allegedly the company’s biggest shareholder with a 60% stake in the company, according to Coin Telegraph. The decision came after the two co-founders butted heads over a major round of layoffs in December 2018 that escalated to a power struggle.

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“Bitmain staff shall no longer take any direction from Zhan, or participate in any meeting organized by Zhan,” stated an email by Jihan Wu that circulated amongst Bitmain employees. “Bitmain may, based on the situation, consider terminating employment contracts of those who violate this notice.”

Bitmain Launched The World’s Largest Bitcoin Mining Farm

According to a Tencent News report, Bitmain hired former Nasdaq China representative, Zheng Hua, to up its chances of the U.S. listing. Just last week, Bitmain launched “the world’s largest” bitcoin mining farm in Texas, after it was reported that Layer1, backed by the Digital Currency Group, raised $50 million for its mining business in the same region.

Bitmain’s IPO filing followed an announcement that its biggest competitor, Canaan Creative, publicly filed for an IPO with the U.S. SEC on Monday, highlighting Citi Group, Galaxy Digital, Credit Swiss, and four others as its underwriters. This was after rumors circulated in July that Canaan had confidentially filed for an IPO in the U.S, undeterred by the trade war between the U.S. and China.

Canaan is the largest ASIC manufacturer after Bitmain, and is expected to list its shares on Nasdaq under the ticker name CAN. The company has declared that it aims to raise $400 million from the offering. Sources have reported that it has generated a revenue of $394 million in the fiscal year 2018, and has shipped over 26,000 AI chips and modules, marking 21.9% of the global market share for bitcoin mining equipment in the first half of the year.

Canaan has tried multiple times in the past to file for an IPO. Previously, it attempted to go public following the purchase of a Chinese electric equipment maker in 2016. Canaan Creative also tried to file for an IPO in Hong Kong back in 2018. Both the times, however, it was faced with rejection.

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