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Briefing: Bitcoin mining rig maker Canaan Creative ponders US IPO
Bitcoin Mining Chip Maker Canaan Considers U.S. IPO – Bloomberg
What happened: China’s second-biggest bitcoin mining equipment manufacturer Canaan Creative is considering a US listing after setting aside its plans for a Hong Kong initial public offering (IPO). The company, which was previously targeting $1 billion, may go public as soon as the first half of 2019, according to Bloomberg sources. The company sells its equipment under the “Avalon” brand, which includes application-specific chips that solve complex mathematical problems to mine cryptocurrency.
Why it’s important: The price of bitcoin has fallen around 80% since its high in December 2017, making it difficult for companies operating in the bitcoin space to attract stock market investors. It also reduces profitability for bitcoin miners—exactly the group Canaan targets. Rival firm Bitmain has reportedly been laying off employees amid the industry crunch. Canaan initially planned to IPO in Hong Kong. However, it let its application lapse in November. Bitmain and fellow rival Ebang also had plans to go public in the city.