Bitmain’s initial public offer (IPO) application with the Hong Kong stock exchange (HKEX) officially expired on March 25, 2019, a Twitter user with the name Dovey Wan noted. With this, Bitmain’s ambitions for an IPO in Hong-Kong have officially come to an undesired end.
After its official IPO filing with the HKex expired Bitmain, on March 26, 2019, announced through a blog post that it has emerged as a transparent and standardized company because of the listing process. The Chinese chip manufacturer also revealed the appointment of a new CEO, Haichao Wang.
Bitmain’s IPO Fails to Take Off
Only a handful of successful companies from the cryptocurrency industry are talked about when speaking of potential IPO candidates. A list of such companies typically consists of giants like Bitcoin mining firms Canaan, Bitmain, and the U.S.-based trading platform Robinhood, among others.
Bitmain, from among the three companies as mentioned earlier, had submitted in September 2018 a filing with the HKEX seeking a public IPO. The application was submitted a few months after the global crypto market had simmered down from an unforgettable frenzy. However, at the time, Bitmain’s financial statements and balance were more than desirable.
The mining chips manufacturer reported stellar figures on the back of the sale of its cryptocurrency mining equipment. The company’s mining rigs sold like hotcakes in the markets and for a few good months, and it enjoyed a virtual monopoly over the young crypto mining industry.
However, things soon took a dramatic turn for Bitmain as its sales dried up due to continued crashes in cryptocurrencies’ prices. Bitmain reported below-par results in the ensuing financial quarters which suddenly put its IPO plans in jeopardy.
It wasn’t long before the global regulatory watchdogs expressed their lack of confidence in Bitmain’s prospects.
On December 21, 2018, BTCManager reported how HKEX stated that it is “premature for any cryptocurrency-linked business to conduct an IPO in Hong Kong before a solid regulatory framework is put in place by the authorities.” This came as a major setback for people looking forward to Bitmain’s IPO.
Later, in January 2019, Charles Li Xiaojia, the CEO of HKEX, dealt a verbal blow to Bitmain saying that a lack of “consistency” in digital currency mining firms’ business models could stall their IPO dreams.
Now, with six months since the date of filing with the HKEX, Bitmain’s dreams for an IPO in Hong Kong have officially come to a close.
Bitmain Bounces Back
In its blog post, Bitmain noted that 2018 was significant for the company in terms of business and revenue. The company added that its mission for 2019 is “to double-down on innovating for and serving our customers.”
Thus, and despite the IPO expiration, the firm reported that it would re-commence the listing application work “at an appropriate time in the future.”
The company claims that going through the exhaustive listing process has made it more transparent and standardized. As mentioned earlier, Bitmain has often found itself on the receiving end of criticism due to its heavy Bitcoin operations, alleged bureaucratic management, among other points.
Bitmain added that towards the end of 2018 it realigned its market product verticals to develop a long-term, sustainable and scalable business and “did its best” to compensate its employees above the legal requirement.
The firm also states that it has made changes to its leadership to align with its new operational model. Mr. Haichao Wang, who has had experience heading various departments at Bitmain, has been appointed as the company’s new CEO.
It’s worth noting that Bitmain’s co-founders, Micree Zhan and Jihan Wu will continue to serve the company as its directors and be involved in important strategic decisions.
Only time will tell if the tides turn for Bitmain in 2019. At the very least, the company doesn’t look afraid to buckle down to overcome the harsh market environment.