Bitcoin Cash (BCH) Rises on Bitmain’s IPO Announcement

After drifting sideways for weeks, Bitcoin Cash (BCH) was among the top gainers in the wake of the announcement that Bitmain had finally filed for an initial public offering (IPO) on the Hong Kong stock exchange. The BCH price added more than 20% net in 24 hours, jumping from around $447 in the afternoon of September 26 to $529.50 on Thursday around 6:00 UTC.

Earlier, BCH peaked briefly above $542. The Twitter community reacted immediately, connecting the price movements of BCH with the financial results of Bitmain. However, the asset was seen as making a short-term movement. Bitcoin maximalists were immediately skeptical:

https://twitter.com/WhalePanda/status/1044982889056751616

The key driver behind the rise of BCH was the financial report released by Bitmain as part of the prospectus for its upcoming IPO. The crypto mining equipment maker unveiled significantly stronger results for the first half of 2018 compared to the same period of 2017, booking $742.7 million in profits on revenues of $2.8 billion. The chief source of income for Bitmain were Bitcoin mining rigs, which accounted for $1.9 billion of revenues, with the rest coming from sales of other types of mining equipment.

According to critics, however, the half-year numbers obscure the fact that Bitmain recorded significantly lower results in the second quarter, which reflected the impact of the bear market.

https://twitter.com/btcking555/status/1045041937047154688

In the report, Bitmain admitted to slowing sales of mining rigs, adding that its financial results would require special provisions in the coming months.

Meanwhile, the BItcoin Cash network has returned to a lower level of transactions, clocking around 20,000 per day in the past week, again trailing Litecoin and comparable to DogeCoin. Additionally, the hashrate of the Bitcoin Cash network has fallen by about 25% in September, as seen on Bitinfocharts.