While this year is just about to end, it seems that the crypto market will kick off the new year combating the slumps in prices of digital currencies. Along with the rest of the community, the largest manufacturer of Bitcoin mining equipment Bitmain is also experiencing a bumpy ride due to one more reason.
In September the bitcoin mining firm officially applied to go public in Hong Kong. In the first half of 2019, Bitmain was able to raise over $400 million from pre-IPO funding round, which was driven by Sequoia Capital for the businesses objective to raise over $1 billion before beginning to secure its IPO.
Here, Hong Kong Exchanges and Clear Limited (HKEX) is reluctant to approve the initial public offering (IPO) by Bitmain, stating that the crypto industry for the country is currently “immature.” The reason behind not approving the IPO is the lack of regulations regarding the crypto space. Practical, clear and certain regulations can govern the crypto industry along with blockchain technology.
Bitmain was found by Micree Zhang and Jihan Wu in 2013, having headquartered in Beijing. It is the most significant manufacturer of crypto-mining chips. As given in the prospectus filed with HKEX, Bitmain recorded more than $2 billion in revenue with a profit of $1.22 billion during the crypto boom of 2017.
The filing reads, “According to Frost & Sullivan, we are the largest global ASIC-based cryptocurrency mining hardware company in terms of sales revenue in 2017, accounting for a market share of 74.5%. We offer a variety of mining hardware equipped with proprietary ASIC chips under our Antminer brand.”
Hong Kong holds public listing rules in which it calls for a closed-door hearing meeting with the Listing Committee. The Committee is expected to declare the final approval or rejection within six months of filing for an IPO. Although, if the applicant fails to hear from the Committee, the listing can lapse.
Reportedly, Bitmain possesses about a 67% share in the market of Bitcoin mining equipment. Along with Bitmain, another manufacturer of Bitcoin mining tool, Canaan Creative applied in June to list shares in the Hong Kong market, in which the application lapsed.
Notably, the uncertainty in the crypto market puts the Bitmain IPO application status in doubts. But, With a robust regulatory framework, Bitmain’s IPO can set a record for a cryptocurrency IPO.