Cryptocurrency Miner Maker Canaan Files for $400 Million U.S. IPO

One of China’s largest cryptocurrency mining hardware manufacturer, Canaan Creative, has filed to be publicly listed on the Nasdaq to raise $400 million.

According to Reuters, this is the company’s third attempt for an initial public offering, after it failed tries in mainland China and Hong Kong over uncertainties surrounding its business model and prospects. Canaan is set to use raised funds to pay off debts and fund blockchain and artificial intelligence research.

Canaan’s filing revealed the Hangzhou-based company lost $45.8 million in the six months ending in June 30 of this year, on a net revenue of $42.1 million. In the first half of last year it profited $25 million on net revenue of $275 million.

It was founded back in 2013 and is the company behind the popular Avalon series of cryptocurrency mining machines. Last year, it made a total net income of $8.3 million, on net revenue of $394 million. The second half, which saw bitcoin’s price drop from over $6,000 to little over $3,200 at the height of the bear market, saw the firm lose $16.7 million.

The company is set to issue 126 million shares, and Chinese news outlets have estimated Canaan’s valuation is between $2 and $3 billion. The application comes shortly after China’s President Xi Jinping encouraged the development of blockchain technology.

The future of cryptocurrency mining in China – and crypto in general – is currently unclear. While the country’s leader supported blockchain technology, the Chinese government has in 2017 shut down local crypto exchanges, and earlier this year signaled it was looking to crackdown on crypto mining.

Xi Jinping’s comments were, as such, widely seen as “blockchain not bitcoin.” His remarks, in fact, did not mention cryptocurrencies like bitcoin and focused on distributed ledger technology.

Featured image via Pixabay.