Bitcoin mining firm Canaan closes day one of trading flat
- Canaan ends the first trading day flat
- Its shares began trading with a jump to $13 before finally settling at $8.99
- Canaan raised $90 million in its IPO
Bitcoin mining machine maker Canaan’s first trading day after IPO ended two pence less than the listing price. The China-based Bitcoin mining hardware company’s much-awaited IPO started its trading day off with a jump before settling at $8.98, down from its Initial Public Offering price of $9.
Canaan, a Hangzhou-headquartered company raised $90 million from the market after offering 10 million shares for subscription. After a couple of failed attempts at listing in China mainland and in Hong Kong, the Bitcoin mining machine dealer settled on Nasdaq as its market of choice.
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Some stakeholders felt that the $90 million IPO was a little underwhelming considering Canaan’s initial valuations and now its low key first trading day.
Canaan becomes the first company with a Bitcoin-based business model to go public after several major exchanges had expressed their concerns about listing crypto-based companies.
Both the New York Stock Exchange and Nasdaq had their reservations about listing businesses with models based on cryptocurrencies primarily due to lackluster performance and increased cases of fraud. However, it seems Canaan has hit the ground running for companies operating in the same space.
Even after clinching $90 million from the US exchange, analysts still feel that the amount was far off October’s valuation that pegged the company’s worth at $400 million.
According to a report by Bloomberg, the company traded 10 million American Depository Shares (ADS) for $9 each on Wednesday. An ADS is an equity share of a foreign firm dominated by the USD traded in a US exchange.
Last week’s official announcement indicated that Canaan intended to raise about $100 million upon trading 10 million shares at between $9 and $11 per share.
Other than missing its funding target, it also lost one of its core fund managers Credit Suisse Group, leaving Citi, China Renaissance, and CMB International Capital to oversee the final stages of the process.
At some point during the first day of trading, Canaan’s shares spiked 44% to $13 before dropping to $ 8.21, this is according to Nasdaq records. By the close of business on Friday, Canaan Inc (CAN) shares were at $8.98.