The leadership at cryptocurrency mining rig maker Bitmain has switched again with the re-ousting of co-founder Zhan Ketuan from the helm of the company’s Beijing operations, rival co-founder Wu Jihan said on Monday.
Why it matters: The leadership drama at the world’s leading mining equipment maker is almost a year running. It has caused disruptions in the company’s supply chain, just as product orders from the US accumulate and China’s cryptocurrency regulation is heating up.
- It is uncertain whether Wu’s reinstatement will be the end of the saga as Zhan has shown an unwillingness to step down time and again.
Details: The registration information for Bitmain’s Beijing entity changed to indicate that Wu was its legal representative, Chinese media reported on Monday evening. Bitmain employees in Zhan’s faction were seen packing up their office belongings, according to reports.
- Wu confirmed the reports in a statement (in Chinese) on Monday, conceding that the “management conflicts” have damaged the company’s brand image, customer relations, employee sentiment, and even “blocked” Bitmain’s plans to go public.
- The reinstated co-founder said he hopes that “meaningless and endless fighting” between the fighting factions will stop and extended his respect to Zhan.
- In August, Bitmain signed two agreements to sell $40.7 million worth of its newest mining rig, the Antminer S19, to North American bitcoin miners, the company said in two press releases.
“The options promised to employees have almost become waste paper.”
—Wu Jihan, recently re-instated Bitmain co-founder, in his Monday statement
Context: The drama started in October when Wu ousted Zhan in a boardroom coup. Wu claimed that Zhan had wasted company resources on an artificial intelligence chip push, far from the company’s main business model.
- But Zhan was not willing to go down without a fight. He sued Bitmain’s parent company in the Cayman Islands and filed complaints with Beijing authorities claiming that the paperwork that unseated him was not filed correctly.
- In May, Beijing officials granted his claim and handed him the company reigns. A physical brawl broke out between the rival camps at the government office.
- After Zhan gained control of the Beijing branch, which manages production across China, the Bitmain saga got even more complicated. Wu was still at the helm of the Hong Kong company that handles international payments.
- Over the next few months, the two had trouble coordinating production and Zhan even ordered deliveries to stop in June.
- Competing company seals and Wechat accounts gave conflicting information, furthering confusion amid staff, customers, and industry observers.