Bitmain, the world’s largest Bitcoin-mining manufacturing equipment company is undergoing quite the restructuring, as the new CEO, Wang Haichao, will be replacing two of the company’s original founders, according to a new report (Jan 10).
It wasn’t too long ago that many people considered Bitmain the most valuable company in the cryptocurrency sector, especially considering the fact that it controlled a significant percentage of Bitcoin mining hardware in the world. However, there’s no doubt that there have been new concerns plaguing the company, causing many to question its highly-valued status.
In fact, it appears as though Bitmain now has a new CEO, and that two of its founders will be leaving, as per a recent report from SCMP. Although there were lingering reports regarding the transition in local media, Bitmain has refused to comment on the report, or offer an actual timetable regarding the transition.
It wasn’t long ago when many were stunned at Bitmain’s exponential growth. In fact, there were many analysts who believed that Bitmain was on track for $10 billion in revenue last year, thanks to an incredible first quarter in 2018 where the company generated $2 billion. This was considered massive growth at the time, especially given that Bitmain had generated $2.5 billion in 2017 and $300 million the year before that.
The company also made headlines when it was responsible for some new additions to the “Hurun list”, a list of China’s richest and most influential entrepreneurs. The list boasts executives from some of China’s most prominent companies such as Alibaba and Tencent. Many believed the fact that Bitmain executives were already landing on the list was a sign of things to come.
Fall from Grace
However, Bitmain’s Q2 2018 numbers were not only less than impressive, but they were also downright disappointing for many who have been following the company. In fact, the company lost $400 million in Q2, which was its worst quarter ever. It’s obvious that no company wants to post its worst quarter right before its initial public offering (IPO), especially when many believed that this would be the biggest cryptocurrency-related IPO ever.
The company was also forced to close its research and development office in Tel Aviv, Israel, December of 2018, which led many to believe that the company was being forced to cut costs. The head of the Israeli office, Gadi Gilkberg, blamed the markets for the closure, stating: “The crypto market has undergone a shakeup in the past few months, which has forced Bitmain to examine its various activities around the globe and refocus its business in accordance with the current situation.”
The founders will reportedly be moving away from making any day-to-day decisions, but will still be instrumental when it comes to making big “final call” decisions. The new CEO’s name is Wang Haichao, who currently is the Bitmain product engineering director, although when exactly he will move fully into the CEO role is still unclear.