Cryptocurrency giant Bitmain chooses Hong Kong for IPO

Bitmain Technologies, the world’s largest designer of products used for mining cryptocurrencies, confirmed it was bringing its IPO to Hong Kong in what will be an important test of institutional investors’ interest in the crypto sector.

Bitmain’s prospectus, investors’ first official look at its financial health, was filed late on Wednesday, and revealed that it made a profit of $742 million for the first six months of this year. The bulk of the company’s revenue came from selling hardware to mine cryptocurrencies, the filing said.

The company said it will use the proceeds of the IPO to invest in research and development and expand its production output.

Bitmain designs different microchips specialised for mining cryptocurrenies and for artificial intelligence applications, as well as manufacturing cryptocurrency and AI hardware, and managing crypto mining farms.

The IPO comes at a time when the cryptocurrency sector is facing a number of headwinds.

The price of bitcoin has fallen 65 percent since its December 2017 peak, and on Wednesday one bitcoin was worth around $6,500.

This fall has hurt the profitability of mining, and in turn has been weighing on sales of mining hardware.

In addition, there are regulatory concerns, given the Chinese authorities’ public scepticism about cryptocurrencies. (RTRS)

Visitors look at a display for 5G wireless technology from Chinese firm China Telecom at the PT Expo in Beijing, Sept 26. The government-organizedevent comes amid a mounting tariff war with Washington over Beijing’s plans for the state-led creation of its own global technology competitors.(AP)