Bitmain: Cryptocurrency miners are losing their technological edge

According to Sanford C. Bernstein and Co., Bitmain Technologies, the designer of cryptocurrency mining chips are planning a landmark initial public offering [IPO], they may be losing their technological edge. The private company has established its headquarters in Beijing, China.

Mark Li from Bernstein wrote in his recent report, the Beijing-based organization, established by Jihan Wu, may need to record the estimation of its stock as the makers of rival cryptocurrency mining equipment are catching up. The world’s largest dedicated independent semiconductor foundry, Taiwan Semiconductor Manufacturing Company [TSMC] produce the chips outlined by Bitmain, they should request all the firms to make full prepayments and refrain from including capacity solely for cryptocurrency-related demand.

Bernstein called Bitmain’s performance a “wild success” last year and noted that it controlled about 85% of the market for cryptocurrency mining chips. Bitmain also has a major share of Bitcoin Cash holdings, and this investment may not be a wise one because its price is falling faster than that of Bitcoin. In spite of their monopoly, the company is confronting rivalry from players including Canaan and Ebang International Holdings, which are also pursuing IPOs in Hong Kong. Bitmain is one of the best operators of cryptocurrency mining and is planning a Hong Kong IPO that could raise almost $3 billion.

Speculations about Bitmain’s funds have increased every day, an effective listing would be a historic point for the Cryptocurrency industry, which is progressively trying to move from the fingers of finance into the mainstream. Unverified investor presentations are indicating to show details of Bitmain’s business which have been circulating online, prompting discussions in cryptocurrency circles over the companies exposure to falling virtual currency prices.

Mark Li said:

“Bitmain has likely been acquiring large amounts of Bitcoin Cash, posing a “major risk” as the bitcoin offshoot’s value declines”

Recent reports by Bernstein mentioned:

“Going forward, the competitiveness of Bitmain’s chips is in question, as Bitmain failed in a 10nm chip [and] possibly other projects too. Rivals now may have caught up in technologies and Bitmain’s inventory may face a major write-down risk.”