It’s no secret that Bitmain is suffering severely and has been for a number of months. The cracks in the company began to appear back in September, and things have gone from bad to worse for the crypto mining hardware firm since. Matters are actually going downhill faster than anyone could have imagined, as Bitmain has just laid off its entire Copernicus team – the team responsible for Bitmain’s Bitcoin Cash Go client.
Company Wide Layoffs
When a firm begins to make its staff redundant, it’s rarely a good sign. Back at the start of December, Bitmain fired all of its employees in Israel, putting an abrupt end to its AI project. While many thought that this would be the end of Bitmain’s headcount chop, it then went and axed the Copernicus team in a worrying series of events. It’s estimated that the final staff cull will be around 50% of its workforce before the New Year arrives.
No IPO for Bitmain
Just before the staff cuts began, Bitmain was handed a massive blow to its future. The Hong Kong Stock Exchange (HKEX) announced that it will not consider any IPO applications of firms operating in the distributed ledger technology or crypto space, as the market is still very immature. The IPO was Bitmain’s final shot at raising some much-needed cash to stay afloat. Now that avenue has been closed the company may very well be staring over the edge of a cliff.
Court Cases Looming
Just in case Bitmain needed any more bad news, it has several court cases open against it. UnitedCorp is suing Bitmain for hijacking the Bitcoin Cash network during the hash war that occurred in the middle of November. On top of this huge case from UnitedCorp, Bitmain also has a $5 million lawsuit against it in California for illegally mining cryptos. A group of 100 plaintiffs have joined forces to take on the crypto mining hardware giant, alleging that it mined cryptos using their hardware without their permission. However. This case could boil down to the miners not configuring their mining rigs properly, which could save Bitmain’s bacon.
Massive Losses from Bitcoin Cash
It’s no secret that Bitmain is a huge supporter of Bitcoin Cash and that it stored a vast amount of its wealth in the crypto. Sadly, during the Bitcoin Cash hard fork and hash war, the cryptocurrency lost the vast majority of its value, causing Bitmain to lose millions of dollars in the space of a few days. In a leaked report, Bitmain had allegedly lost more than $740 million in 2018 before the Bitcoin Cash fiasco. After the Bitcoin Cash hash war losses are factored into this equation, Bitmain’s finances look to be in a terrible state and it quickly becomes easy to see why it’s laying off staff.
Bitmain might be ready for its curtain call in 2019, and the Deutsches Technikmuseum in Berlin already has a new home for the ex-mining giant to call home. Its prospects have never looked worse, and as a trade war between China and the US continues to hit sales of its mining hardware, the end looks near for Bitmain.