Bitmain Co-Founder Offers Share Buyback At $4B Valuation To End Power Struggle

Zhan Ketuan, the formerly-ousted Bitmain co-founder who returned to energy earlier this month, is proposing an answer to finish the agency’s inner conflict.

In a letter Sunday, Zhan, who as Bitmain’s superlative shareholder owns 36% of its inventory, supplied to purchase once more shares possessed by his rival co-founder Wu Jihan, a number of creation members and few of Bitmain staff, at an organization rating of $four billion.

Wu alone controls about 20% of Bitmain and three different creation members personal about 15% in complete. Bitmain’s worker inventory choice pool has one other 19% and the odd 10% belongs to exterior traders.

But Zhan’s $four billion rating of the agency is considerably down from a market excessive seen in the summer 2019. Bitmain had been valued at round $1 billion in September 2019 throughout its Series A spherical. When it went on a excessive visibility fund raise in August 2019, it was valued at $12 billion and finally $14.5 billion in a pre-IPO spherical.

The supply is available in an effort to result in negotiations that power finish the divisions which were tearing the corporate aside since Zhan clawed his means once more into the agency after being ousted by Wu final October.

Chip menace

In addition to inflicting division amongst staff, the facility wrestle is now endangering the agency’s miner manufacturing processes.

Zhan’s letter had been in response to a Sunday assertion on Beijing Bitmain’s official web site, which is managed by Wu, expression that its Hong Kong guardian entity had minimize off the chip C.P.U. provide chain to its Shenzhen manufacturing unit.

“Bitmain Hong Kong has suspended the chip supply for the moment to Century Cloud Core, which is now controlled by Zhan’s relatives, until we are assured, through negotiation with Zhan’s relatives, that they are committed to protective the interest of Bitmain’s customers and of the company as a whole,” the assertion reads.

Bitmain Technologies Limited in Hong Kong is Bitmain’s sea gross revenue and procural heart for crypto mining {hardware}. The bitcoin miner’s manufacturing enterprise depends on computing chips provided by semiconductor corporations.

Since Zhan’s forceful return to the agency, he had appropriated direction of Century Cloud Core, Bitmain’s packaging manufacturing unit and storage warehouse in Shenzhen, and paused shipments to prospects. According to a former worker at Beijing Bitmain who’s familiar with the matter, Zhan’s brother-in-law, Zhou Feng, has been positioned in command of the Shenzhen entity.

In his letter, Zhan responded that, if obligatory, he would procure chips instantly by way of Beijing Bitmain, even when that may trigger an excessive amount of loss for the corporate as an entire.

He extra accused Wu of, amongst different issues, forging a decision one-handed by a claimed “shareholder meeting” final November on the Bitmain’s Cayman Islands-based holding entity. In truth, the assembly was not by a blame sigh held as a result of “several other shareholders including Zhan Ketuan as the biggest stakeholder ne’er received a notice of such meeting ever,” Zhan claimed.

Beijing Bitmain Technology Ltd. is a altogether closely-held subsidiary of Hong Kong-based Bitmain Technologies Ltd. That, in flip, is altogether closely-held by the final word dominant entity, BitMain Technologies Holding, which integrated inside the Caymans but in addition registered in Hong Kong.

When ouster Zhan in October final 12 months, Wu filed to the Hong Kong government to have Zhan’s identify eliminated as a board director on the Cayman holding firm.

The two sides now have an on-going authorized case inside the Cayman Islands some disputes over Zhan’s 60% vote energy at Bitmain.


The chief in blockchain information, CoinDesk is a media outlet that strives for the best print media requirements and abides by a strict set of editorial insurance policies. CoinDesk is an impartial working subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups.

Bitmain Co-Founder Offers Share Buyback At $4B Valuation To End Power Struggle

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