Bitmain: Unicorn IPO or Massive Fraud

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In early August, Beijing-based Bitmain Technologies announced its plan to go public in Q4 2018 to much excitement and fanfare. The Chinese cryptocurrency company, founded in 2013 by Jihan Wu and Micree Zhan, has long been a powerhouse in the cryptocurrency space. As a pioneer of ASIC mining chips, Bitmain controls approximately 70 percent of the mining chip market and is also responsible for a substantial chunk of Bitcoin’s computing power through its mega-mining pools Antpool and BTC.com. Controversial and brilliant 32-year old billionaire Jihan Wu. This combination of dominance and diversification in the Bitcoin mining process has helped it become a financial powerhouse, with profits in 2017 estimated to be somewhere between $3-4 billion, according to Bernstein Research. Bitmain also reported a net profit of $1.1 billion in the first quarter of 2018. Given their massive profits, and news of a $1 billion pre-IPO-financing round, Bitmain’s valuation rose to