Bitmain reveals financials as it plans IPO
Fortune magazine revealed on Monday it had seen some of the latest financial figures from Bitmain, the Beijing-based cryptocurrency mining company, as it plans an overseas initial public offering (IPO) later in the year.
In an email to Fortune, a “source close to the company” cites an audit of the world’s largest crypto miner by KPMG that reports net profit of $1.2bn in 2017, with a net margin of around 50%.
Bitmain reportedly earned net profit of $1.1bn in the first quarter of 2018 – a period that would have caught the best and the worst levels of many digital tokens. The email said a conservative estimate of what the company is likely to earn in the full year was established between $2bn-$3bn.
Given such likely figures the company would not want to linger too long over its IPO plans and, indeed, the email concluded “Bitmain plans to file an IPO very soon”.
It was reported by Bloomberg back in early June that Jihan Wu, the co-chief executive of Bitmain, was open to holding an IPO, most likely in dollar-denominated shares on the Hong Kong Stock Exchange.
$2bn initial public offering
Monday’s email to Fortune, however, suggested the company could be looking to raise enough funds from the offering to give the company a $14bn valuation.
This would represent a $2bn premium over the company’s reported valuation following a second round of funding from its main backers Sequoia Capital, Coatue and EDBI.
An IPO and subsequent listing on a stock exchange would open Bitmain’s business up to the world, giving the miner a real-time valuation and compelling the company to report its earnings every quarter.
But it would also send a message to the rest of the industry, which is still in its early stages of development with some miners, exchanges and other associated businesses looking to gain legitimacy in the markets.