Crypto Miners Taking Advantage of Hot Market to Raise Funds
Cryptocurrency companies are taking full advantage of the ongoing bull market. There is a lot of euphoria present in the market as Bitcoin becomes a trillion-dollar asset and the overall crypto market cap grows past $1.7 trillion.
Already, we have seen the leading US exchange Coinbase filing to go public with a whopping $100 billion valuation. This is only expected to lift the market mood further, described by some as a watershed moment for the crypto industry.
Another crypto exchange Kraken is on track to do the same, but not until next year. ICE backed Bakkt took the SPAC route, and so did the Bitcoin miner Cipher.
The same can be seen happening in China, attracting millions of dollars.
Chinese Bitcoin mining machine manufacturer Ebang International Holdings conducted two fundraising rounds just last month. The company that debuted on Nasdaq in June raised $170 million.
Eban plans to use the newly raised capital to expand into crypto mining, to open crypto exchanges in Canada and Singapore, and to launch a Robinhood-like Bitcoin trading platform. Guo Yi, COO at Univest Securities, which underwrote the deals said,
“Ebang’s growth story is very attractive to institutional investors … fundraising by all industry players is getting busier thanks to the bitcoin bull.”
Last month, it also announced that it would be launching Dogecoin (DOGE) and Litecoin (LTC) mining operations, for which they completed a design of a chip for simultaneous mining.
A newcomer, another Chinese company, Code Chain New Continent Ltd, the waste recycling company raised $25 million in February to foray into Bitcoin mining, for which it has ordered 10,000 machines. David Feng, co-CEO of Code Chain said,
“Bitcoin prices present us with a unique opportunity to establish mining operations.”
Another Nasdaq-listed Chinese Bitcoin mining machine maker, Canaan Inc., is expanding into mining.
In private markets, “competition is white-hot and filled with sharp elbows,” said Jehan Chu, managing partner at Hong Kong-based blockchain venture capital firm Kenetic Capital. “Every good-quality funding round is oversubscribed within a week of it being announced.”
Crypto miner Argo Blockchain announced this week that it had raised around £26.8mln (nearly $37.5 million) through a placing of new shares to institutional and other investors. It will allow the company to complete an investment in Pluto Digital Assets and pursue strategic opportunities in crypto mining, decentralized finance (DeFi), and Web 3.0 initiatives.
Cobo, a crypto custodian and wallet service provider, is also planning to launch a new round of venture capital funding this month to finance its international expansion. “The market is bullish, and our business is growing very, very rapidly,” said Jiang Changhao, co-founder and CTO of the Beijing-based company, aiming for tens of millions of dollars.
Amidst this, the world’s largest crypto-mining equipment maker, Bitmain, has been the target of an investigation into illegal talent from Taiwanese firms over a period of three years. Taiwan prohibits firms from China from recruiting locally or doing business without prior approval.
In other news, JPMorgan has filed for a “Cryptocurrency Exposure Basket” through companies that invest in digital assets. The referenced stocks are Riot Blockchain, NVIDIA Corporation, Taiwan Semiconductor Manufacturing Company Ltd., and others.