The Financial Times explores discrepancies found in Bitmain's IPO filing

The Financial Times reports that Bitmain, the crypto mining giant, posted profits in its IPO prospectus that were significantly smaller than what it told investors in its earlier funding rounds. According to Bitmain's IPO prospectus, the company stated ~$701 million in 2017 net profits. However, in documents published ahead of its pre-IPO funding round, just one month prior to the IPO, Bitmain said its net profits for 2017 were $1.1 billion.

When this discrepancy was brought to the attention of Bitmain, the company told The Financial Times to 'refer to our IPO prospectus for appropriate figures.' One venture capitalist believes that this discrepancy shows that Bitmain's "management doesn’t know how to communicate with the capital markets. It just shows that they are not sophisticated enough and maybe too aggressive.” The Financial Times also reached out to venture capitalists to gauge their opinions on the overall prospect of Bitmain. One bullish investor stated that Bitmain has 'a chance... to become a serious chip player in China and broaden their AI products.' One bearish investor stated 'I am not a fan of the bitcoin infrastructure play, it is fairly speculative in nature and these machines don’t really create significant value.'  (Source: The Financial Times)

About Author

Steven Zheng is a researcher for The Block. He joined The Block in August 2018. Steven graduated from St. John’s University with a degree in economics. Previously, he covered blockchain and crypto at Radicle, a startup analytics firm. He also had brief stints at Cheddar, a media startup, and Bowery Capital, a venture capital firm. He owns bitcoin. Follow Steven on Twitter at: @Dogetoshi