How Could Bitmain Destabilize And Affect The Whole Cryptocurrency Market?
Bitmain is one of the largest cryptocurrency mining companies in the whole cryptocurrency market. However, in the near future, it may replace its chief operating officers Jihan Wu and Ketuan Zhan. The information was recently released by the South China Mining Post.
This decision comes after several months of speculation in which Bitmain announced that it lost billions of dollars during the first quarter of 2018. At the same time, the company had to fire more than half of its staff, including a team that was working with an upgrade to Bitcoin Cash (BCH). Furthermore, its office at Tel Aviv was also closed by the company.
At the same time, back in September, the company applied to go public in Hong Kong. However, regulators rejected the Initial Public Offering since there is a lack of regulatory framework related to crypto companies.
The mining hardware manufacturer company had a good year in 2017 when Bitcoin was skyrocketing. But it seems that its strategy to be focused on mining hardware did not produce good results for it. According to BitInfoCharts, the company sold around 8,000 BTC as soon as the market started to plummet at the beginning of 2018. Additionally, during the year, the company maintained its balance.
Furthermore, a Bitcoin SV wallet revealed that there was a BTC wallet whose balance moved down to zero when Bitcoin Cash hard forked. The crypto market experienced an important drop in price this day. Bitmain decided to support the Bitcoin ABC proposal for Bitcoin Cash, that was also backed by Roger Ver, the CEO of Bitcoin.com.
At the moment, Bitmain holds 8.490 BTC. However, the number can be larger, depending on the number of BTC it has in other wallets that are not public.
If a company that owned 70% of the mining market losses its funds in this way without showing a genuine growth, it does not provide confidence to investors that want to place their funds on it. At the same time, if it starts selling its BTC, the market would take it in a very negative way.