Chinese bitcoin mining rig maker Bitmain will reportedly lay off part of its workforce in preparation for the next bitcoin halving event in May, and also to undo rapid expansion carried out under ousted chief executive Micree Zhan Ketuan last year, according to local media.
Why it matters: Bitmain, one of the world’s largest manufacturers of mining rigs, has been in turmoil since CEO Wu Jihan ousted Zhan, co-founder and former co-CEO, in October.
- Fluctuating bitcoin prices, as well as increased regulatory oversight, have also affected company operations over the past year.
- Expected this May, the bitcoin halving will cut the number of new coins awarded to miners by half. Significant volatility in the cryptocurrency space is expected.
“Depending on market conditions and business developments, we continue to make adjustments to our staff. As a result, we also are continuously on the lookout for new talent and welcome applicants from all walks of life.”
—a Bitmain spokesperson told TechNode
Details: The “workforce optimization plan” has reportedly been in progress since late 2019, reported Chinese blockchain new media outlet Wushuo Blockchain.
- Bitmain staff revealed that the company’s operations and capital flow are in a healthy state and that the move is mainly to offset Zhan’s expansion efforts and to better prepare for the next bitcoin halving, according to multiple anonymous sources cited in the article.
- Last weekend, Wu reportedly held a company meeting and ordered department heads to provide a personnel optimization list. The changes are expected to be made before Bitmain’s annual meeting on Jan. 17.
- Another focus of the optimization is Zhan’s push into AI chips, which is yet to generate a profit. The operation was a major point of contention that drove a wedge between the co-founders.
Context: The company shuttered some overseas operations in December 2018, shedding half of its workforce. According to the company’s social media account, it has more than 2,500 staff globally.
- Bitmain filed to list in Hong Kong in late 2018, but the application lapsed in March last year. The company’s failed attempt to float in Hong Kong resulted in Wang Haichao’s appointment as CEO, replacing Wu and Zhan, who served as directors after the leadership change.
- TechNode reported in mid-December that the mining rig maker’s legal troubles were mounting, with more than $1 million of its assets frozen.