Editorial 4 October 2018Ed Drake
Bitmain resorts to threats over fragile IPO
Our sources tell us that Bitmain executives have promised to “disappear” anyone who crosses them inside China.
While doing the background research for another Bitmain article, our sources told us of the disturbing threats, and we were able to confirm these with our other sources close to Bitmain.
I don’t believe this was a Google translate error, where they meant to say that they’d beat their competitors fair and square in the free marketplace but instead like the old gangsters in Las Vegas, they’d drop them in a hole in the middle of the Nevada desert.
Bitmain released a prospectus, in advance of their long-planned IPO, to lukewarm reviews as the document raised more doubts about the company’s long-term viability.
According to a Medium post by Ken Lu, several points should concern every investor particularly in referring to slide 30 of their investor deck, Bitmain misrepresented its net profit.
To quote Lu, “…misrepresenting this and to such a degree is nothing short of financial fraud.” (You can read the post here.)
The prospectus highlighted the company’s unsold hardware and their warehouses of unsold technology which at a time was the best on the market but has recently been surpassed by new players who are producing faster and more efficient miners leaving the prospects of millions of dollars in inventory going unsold and written down for massive losses.
In recent weeks, Pangolin released its well-received Whatsminer M10 ASIC Miner , while initial test results for the upcoming Squire Miners indicate 1.5x more hashing capabilities while consuming 50% less energy than the top of the line Bitmain ASIC miners.
Interestingly, the Pangolin miner comes from the mind of former Bitmain technologist Yang Zouxing. Bitmain has struggled to replicate the success they had with Yang Zouxing who did the heavy lifting with chip design.
Their inability to combat the corporate brain drain as their top tech minds continue to leave the company have put Bitmain in a dire situation.
Attempting to defraud investors and now issuing veil threats of violence against people who dare compete with them in a free market isn’t the behaviour of a stable and trustworthy company deserving of investors cash. It’s the behaviour of gangsters who are desperate for money hoping a hail mary IPO will give them some semblance of hope at surviving in this new competitive marketplace.
This all adds smoke to the Bitmain Bankruptcy rumours.
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