Chinese Crypto Currency Mining Firms To Float IPOs Amid Fears Of Viability

Despite falling demand for chips and bearish Bitcoin price action, three mining firms plan to float IPOs. The news comes further amid a cryptocurrency crackdown that has intensified in China. The companies are Bitmain, Canaan Incorporated and Ebang International Holdings.

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The companies have chosen to go public at time that the crypto market is experiencing a lot of problems. Key among them is the fact that the market is at the moment down around 70%. The companies are confident that they will feather the headwinds and make profits in the future nonetheless, or so they broadcast.

The market today is in no way comparable to the boom at the end of 2017. At that time, mining hardware was going for high prices as the value of digital coins increased. For that reason alone, the three companies have entered the list of unicorns.

Concerns and controversies

Ahead of the IPO, Bitmain is valued at $10 billion which makes it the most valuable among the three giants. However, according to news sources in the region, Temasek, an investment firm in Singapore involved in the IPO, had threatened to pull out of the company. The reports claim that the Singapore government-owned firm cited a misrepresentation of facts and figures. This is one of many other issues that will be of interest in the run up to the public offering.

The issues notwithstanding, the good news is that Bitmain manufactures hardware that is usable in wider blockchain technology. It is therefore possible to rake in profit amid crypto plunge. For this reason, many commentators believe that the offering will go on unhindered.

Contemporary gold rush

According to reports by Reuters, Canaan Creative was estimated to be worth approximately $500 million in mid-2017. These are good figures for a company that wants to go public. The firm seeks to raise about $1 billion from the IPO. Commentators have equated the soaring returns by the mining companies to the companies of the gold rush era. As the demand for cryptocurrencies goes up, the need for mining equipment increases hence more sales for the companies.

Ebang is also targeting a $1 billion sum from the IPO that is happening on the Hong Kong Stock Exchange.

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