Former Bitmain Chip Designer Creates MicroBT Crypto Mining Company to Rival Bitcoin ASIC Leader
Former Chip Designer for Bitmain Decides to Become Their Latest Competition
Yang Zuoxing has been fighting against Bitmain Technologies for quite some time to become the dominant provider for crypto mining chips. The former employer has had no problem maintaining his stance, but Yang hasn’t given up hope. The decision to finally host an initial public offering this year, despite the startup being two years old, will hopefully give them a little stronger of a stance.
In an interview recently, Yang spoke candidly about his departure from Bitmain, along with the time that he was employed there. His role was to help with the design of their innovative technology. However, when founders Jihan Wu and Micree Zhan turned down his request to have a stake in Bitmain, Yang decided that it was time to go. MicroBT was started only a month later as his own crypto chip company. He believes that, based on MicroBT’s progress so far, they have created superior mining chips to Bitmain’s. He even went as far as to say, “We compete in every area.”
MicroBT has become the latest challenger to Bitmain’s dominance over mining technology. However, Frost & Sullivan believes that the market will increase to $17 billion by 2022, even though there has been a selloff this year for cryptocurrency and other digital assets.
In 2017 alone, Bitmain took over about three-fourths of the market. Based on the information from analysts Mark Li and others, the company could be losing its edge if MicroBT continues to make the same progress. Bitmain hasn’t made any comments on these developments but has noted that the increased competition from other companies as a risk for their success.
So far, MicroBT has managed to reach approximately $22 million from individual investors. To gain more funding, they are also working with institutional investors in China soon. The aforementioned IPO would help them to get involved with public equity markets in the meantime.
To be more appealing to investors, MicroBT capitalizes on their lack of exposure with Bitcoin Cash, which has fallen about 60% this year. Bitmain, on the other hand, has been a long-standing supporter for Bitcoin cash. However, Bitmain still manages to overtake MicroBT in pretty much every other financial measure.
Based on the IPO filing alone, Bitmain earned $743 million on $2.8 billion of sales during the first half. During the same period, MicroBT only managed to reach $48 million in profit out of $186 million in sales. However, MicroBT did not offer any other details about their financial situation. Despite the way that Bitmain is maintaining dominance, it still may not last. One indication of their potential downturn is their $253 million write-down on unsold inventory for the first half of 2018.
With Yang as the majority shareholder of MicroBT, he’s ready for the challenge of dethroning Bitmain. Yang has a background in hardware and low-wattage chip designs for multiple companies and has been involved with their design in some capacity since 2014. Though Bitmain has tried and failed to sue Yang over patent rights, they actually ended up stripped of their own patent, due to the widely used circuit designs.
Right now, the flagship Whatsminer M10 device from MicroBT has more power efficiency than Bitmain’s most recent product S9i. Yang simplifies the whole competitive ordeal, saying, “Their technology is great. But ours is too.”