Bitmain was once the most respected crypto mining outfits in the world, selling its popular mining rigs all around the globe. However, in September 2018 shit hit the fan for Bitmain, with its Bitcoin network hash rate dropping to 32% dominance. Then, after a few risky moves and bad calls during the Bitcoin Cash Hash War, its Q3 earnings report shows that Bitmain had lost $740 million due to poor business decisions.
After months of reshuffling, a new CEO, and a bull market emerging, Bitmain is still reporting huge losses. A leaked report in Chinese media states that Bitmain recorded a $625 million loss in the first quarter of 2019 – not the best way to kick off the year.
Not All Bad News
According to the report, Bitmain saw losses of $345 million and $280 million in January and February. Considering the low price of Bitcoin at the time, that huge cost is excusable, especially when you factor in its aging mining hardware. Then in March, Bitmain posted a $315 million profit after selling off a bunch of its 16nm ASIC mining rigs. These rigs were sold at a discounted price in order to clear out old stock and make way for its new 7nm mining rigs.
Say Hello to the New 7nm ASIC Mining Chip
Back in February, Bitmain announced that it had perfected a new design and was going to begin mass producing its new 7nm ASIC mining chips. This coincided with the 16nm ASIC chip selloff, hinting that its new chip could very well be the future of ASIC mining. Bitmain allegedly placed an order for 7nm chips from the Taiwan Semiconductor Manufacturing Company (TSMC), which have a lead time of around four months. Bitmain is now likely taking delivery of these chips and start putting them to work in its new ASIC mining rigs. If all goes well, Bitmain should once again be able to keep up with the big boys of the crypto mining space and finally post a net profit.
Is the Bitmain IPO Coming Soon?
Back in July, Bitmain began offering stock options to all employees – rather than a limited few that it previously gave this perk to. This is a huge sign that Bitmain is working on an IPO in order to raise funds to continue developing its AI systems. In a bid to skirt around tariffs on Chinese imports, it looks as if Bitmain will hold its IPO in America during the second half of 2019. While the IPO might not go live in 2019, it’s very likely that it will file a submission before January 1st rolls around.
Bitmain is slowly building up momentum to regain its position as the leading name in crypto mining. If it manages to post a positive result for Q2 and Q3, its IPO could raise billions of dollars as investors look to gain exposure to one of the biggest firms in crypto mining.