According to the report published by the Financial Times on Wednesday, Bitmain Technologies, China's largest mining company, aims to raise $ 1 billion during the pre-IPO.
The search for financing is linked to the fact that the company is working in a completely different way. The sharp drop in the price of bitcoin has reduced the demand for Bitmain's mining equipment, forcing the company to reduce its prices for its product line. However, according to Financial Times, Bitmain is still more than half of all bitcoins.
In addition to rumors about the private financing round, Bitmain also intends to conduct a public IPO, which is expected to raise about $ 30-40 billion over three years. The document indicated that the current valuation of the IPO was $ 14 billion.
Bitmain is not the only major manufacturer of miners in the world, and soon, it might not be in its own country. Canaan Creative, the second largest company in the market, which holds 20% of the sector's shares, applied for a work permit in Hong Kong.
At what speed are the prices of equipment for bitcoin mining decreasing? According to the Financial Times, the miners, who were sold at 30,000-40,000 yuan, now have a value no greater than 4,000. According to representatives of Nvidia, last month they sold cryptocurrency chips and similar products for $ 18 million, while they thought they were getting as much as $ 100 million.
Bitmain is directly exposed to market fluctuations as it holds approximately $ 1.2 billion in digital currency.
According to Finance Times, the financing of Bitmain depends on the volatility of cryptocurrency. Unknown investors involved in the project believe that price generation and product distribution is also associated with this volatility.