Jihan Wu gains upper hand in Bitmain’s ongoing civil war

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Previously ousted Bitmain CEO Jihan Wu has reportedly regained some control over the dysfunctional block reward mining hardware manufacturing company he helped found.

Following Wu’s past October 2019 coup d’ état, which saw him remove co-founder Micree Zhan as chairman, executive director, and legal representative, Zhan regained his status this year as a legal representative of Bitmain after winning the local government approval. 

This latest twist in the power struggle reportedly stems from a Sept. 14 business registration record update showing Wu being reappointed as the legal representative and executive director of Beijing Bitmain Technology, again displacing rival Zhan. Reports on Chinese social media say some employees loyal to Zhan were seen clearing out their office belongings. 

Beijing Bitmain Technology is the operating entity of Bitmain, and Zhan remains a general manager of the firm. In China, a company’s legal representative has broad powers to act on a firm’s behalf and typically holds its official seal, a vital element for signing company decisions into effect.

In a statement issued Sept. 15 via the WeChat account of Bitmain’s Antminer brand, Wu reaffirmed the status update and said the company’s respect for Zhan “remains unchanged.” The update suggests a possible ceasefire in Bitmain’s internal power fight, even as the two’s lawsuits in the Cayman Islands are pending a final judgment. 

There’s not a lot of confidence in the leadership at Bitmain. The yearlong drama at the market leader for ASIC miners has damaged Bitmain’s market share, supply chain, and brand image while hurting its earnings. Wu conceded as much in the WeChat posting, vowing to find sustainable solutions to solve all the problems caused for employees, investors, and customers because of the Co-founders’ war battle for control.

“We have lost customers, and employees were forced to take sides,” says Wu. His statement further adds that “Various breaking events and negative news even thwarted our plan to go public. Our equity option promised to employees almost became a useless piece of paper.”

This move comes during a weird 30-day span for Bitmain. It faces mounting concerns over its recently announced rollout of the new 5nm chips and conflicting messages from the two co-founders around when ASIC miners using the new chips will be released.

If Bitmain still harbors IPO aspirations, it has a long way to go to repair the reputational damage the civil war has caused to its image. Only time will tell if Wu’s return is permanent or if Zhan has another trick up his sleeve to wrestle back control of the firm.