Tech

Ed Drake

Crypto mining giant Bitmain gears up for ‘record breaking’ IPO

Cryptocurrency mining hardware manufacturer Bitmain is reportedly considering an initial public offering (IPO), in a move that could set new records for the cryptocurrency space.

According to a Bloomberg report, China-based Bitmain has started laying the groundwork for the IPO, with a view to launching sooner rather than later. The reports coincide with growing attempts from the firm’s CEO Jihan Wu to raise the public profile of the company, following an increase in the number of interviews he has given in recent months, coupled with an apparent willingness to share more information about the business.

Wu recently shared revenue figures with the news outlet, citing $2.5 billion in revenues over the last year from their core cryptocurrency mining business. While this was below some estimates, it is still considered an impressive outcome for the business, and pitches at a level that would place a significant value on any initial offering.

Bitmain is believed to have control of some 80% of the ASIC manufacturing market. By contrast, Canaan Creative, which controls around 15% of the market, is expected to raise in excess of $1 billion through its forthcoming IPO, giving some indication as to the potential value of any Bitmain IPO.

Wu himself has valued Bitmain at $12 billion, which corresponds to the company’s revenues, which are some 12 times bigger than Canaan. However, some analysts have suggested $8.8 billion to be a price more reflective of the firm’s value, based on multiples from loosely equivalent businesses. Nevertheless, an IPO at this level would set new records for the cryptocurrency space, and represent another step forward in the acceptance of cryptocurrency by mainstream financial markets.

As one of the largest operators in the cryptocurrency mining market, which currently has a distinct lack of publicly listed companies, Bitmain shares would also likely trade at a significant premium over value, creating the potential for a strong debut for any initial equity.

Alongside their interests in cryptocurrency and mining hardware, Bitmain is also increasingly diversifying their business, including a new artificial intelligence (AI) division based on its experience in the ASIC market.

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