Bitmain Pre-IPO Investor Deck Reveals Huge BTC for BCH Bitcoin Swap, Are They Going Broke as a Result?

Crypto Rumor: Bitcoin Mining Giant Bitmain ‘Might' be Going Public via IPO Because they ‘are' Going Broke

Bitmain Technologies, the cryptocurrency mining company, is filing for an initial public offering (IPO) potentially as high as $18 billion this September at a market capitalization of $40 to $50 billion.

As one of the most valuable crypto companies, Bitmain closed a $1 billion pre-IPO financing round on July 23 at a $15 billion valuation, nearly two times cryptocurrency exchange Coinbase's $8 billion valuation. A possible $18 billion IPO sticker price positions Bitmain to displace social media giant Facebook as one of the largest public offerings in history.

However, it’s Bitmain’s fairy tale rise to the top has had some consequences on the company’s business model which should send red flags to its investors. Samson Mow, the CSO of Blockstream in a Tweet points the risk for any investor to participate in Bitmain’s IPO.

Samson adds to this by saying,

“The Bitmain IPO is incredibly risky for any investor to buy into. The potential for massive losses is just around the corner as they have no idea how to maintain BCH, but are all-in. Play stupid games, win stupid prizes.”

A Twitter user points out

“Since they can't unload BCHbags because of low order books, maybe they planning selling company to shareholders with IPO to get rid of BCH bags.” If true, this might be “An exit scam that will go down in history.”

Looking at Bitmain’s stats that Mow shared, and considering that selling just 30k of BCH will destroy the whole order book on Bitfinex, there are very little chances for Bitmain to sell it. This might be the reason why they want IPO, they can’t sell their assets, however, if they can sell stocks, they won’t need to. They have to do their IPO before the next quarterly report to get a higher valuation, as BCH was down over 80% from March 2018. He also brought up the Bitcoin Cash vulnerability that was recently making headlines that is worth reading into.

Twitter user Vortex and the founder of CryptoCastNet weighed in on this by saying “Looks like we know why Bitmain wants to IPO. They are going broke, fast.”

He pointed to the following thread to make his case.

Bitmain seems to have cornered themselves into a stalemate here. If Bitmain decides to switch the majority of its hashing power to BCH, they risk losing bunch of miner support that are pooling in and BCH rates will certainly plummet. Looks like BCH might have slayed the dragon.

Here are a few more interesting takes from Twitter worth reading into and researching more about:

This should be very interesting to see how it unfolds. What do you guys think about the analysis of these ‘crypto experts' within the community?

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