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Secretive Crypto Miner Opens Its Books Ahead Of IPO

BTC

Chinese crypto mining giant Bitmain—a longtime, secretive crypto powerhouse with 30 percent of its assets in cryptocurrencies—has finally opened up its books for all to see and confirmed that’s it’s preparing to go public on the Hong Kong stock exchange.

It’s a big deal because no one has ever seen inside Bitmain, and now we know that it managed to make over $740 million in profit in the first half of this year—despite the fact that cryptocurrencies have been on a downward spiral.

And that $740 million represents a nine-fold increase in profits from the same period last year. It’s pretty impressive against a backdrop that has seen digital currencies lose some $600 billion since the start of the year.

(Click to enlarge)

Bitmain saw revenue jump 9-10-fold to $2.8 billion in the first half of 2018, with an adjusted return on equity of 58.9 percent. By the end of June, the Chinese crypto giant had nearly $887 million in cryptocurrency assets, as Bloomberg reports.

So, while the 30 percent in crypto assets is basically a wash, Bitmain has a massive user base. As of the end of June, it had 80,000 customers—up from only 6,000 three years ago and 46,000 last year.

There are multiple big revenue streams here. Related: Poll: 80% Of Consumers Bullish On Bitcoin

Bitmain is the world’s largest provider for crypto miners, and it’s big into chips and hardware products based on AI, which will remain a key focus. For anyone who’s heard of ‘Antminer’ devices, this is Bitmain’s main territory, and Bitmain claims it has cornered 74.5 percent of the global market share for crypto mining hardware, according to Frost & Sullivan, as reported by Business Insider.

Antminers make it possible to mine cryptocurrencies, and this hardware is where Bitmain is raking in the cash. In the first half of 2018, ‘Antminers’ accounted for 94 percent of Bitmain’s revenue, up from 77 percent in 2016 and 90 percent in 2017.

It also brings in revenue from mining farms, shared mining pools and blockchain services.

The crypto investor world will be closely watching the planned Bitmain IPO because even though this playing field is getting more crowded and others are also gearing up to IPO in Hong Kong, Bitmain will be the litmus test. And if it successfully IPOs, it could snowball in the bulls’ favor.

Bitmain remains highly influential in the crypto world. Watch what happened to Bitcoin Cash right after the Chinese mining giant revealed its financials, showing its bet on this specific digital currency. Bitcoin Cash rallied 20 percent right after this revelation, paring some of those gains later on Wednesday, but still up over 16 percent as of the time of writing.

(Click to enlarge)

Source: CNBC

We don’t know yet what valuation Bitmain is targeting, and they haven’t even hinted at how much they hope to raise in an IPO.

In July, Bitmain closed a $1-billion pre-IPO financing round led by China International Capital Corporation, with a $15-billion valuation, Coin Desk reported.

According to CoinDesk, though, the IPO could be as high as $18 billion at a market capitalization of $40-$50 billion. That would make it one of the biggest IPOs ever.

By Michael Kern for conil.me

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