Cryptocurrency mining giant Bitmain continues to gain attention over its initial public offering (IPO) as critics raise the alarm over its financial outlook. As icryptome.com reported at the end of July, the manufacturer announced its plans to hold a $14 billion IPO before the end of 2018, having achieved Q1 profits of over $1 billion.
Since then, data about the offering to pre-IPO investors have raised suspicions over Bitmain’s prospects, doubts specifically focusing over its huge reserves of altcoin Bitcoin Cash (BCH), which would remain illiquid unless markets transformed prior to the IPO date.
“According to the Bitmain pre-IPO investor deck, they sold most of their [Bitcoin] for [Bitcoin Cash],” Blockstream CSO Samson Mow wrote on Twitter August 11.
The pre-ICO figures the company released last week saw many sources conclude its degree of investment in BCH could ultimately spook investors who understand the state of the altcoin’s liquidity and Bitmain’s role in preserving it.
Beyond BCH, Bitmain’s undisclosed but likely underwhelming Q2 performance, lack of competitiveness, unsuccessful recent product launch and the cryptocurrency bear market are all factors stacked against it.