Bitmain’s IPO dream hindered as Hong Kong Exchange reluctant to grant approval
Amid the shuttering of cryptocurrency mining firms as an aftermath of the crypto market crash, the Hong Kong exchange [HKEX] is unwilling to approve Bitmain’s Initial Public Offering [IPO]. The exchange is reluctant to approve the IPO considering the volatility of the crypto industry, a CoinDesk report revealed, citing sources.
“The exchange is very hesitant to actually approve these bitcoin mining companies because the industry is so volatile. There’s a real risk that they could just not exist anymore in a year or two,” the source cited in the report. “The HKEX doesn’t want to be the first exchange in the world to approve this and have one die on them.”
Bitmain had filed for its multi-million dollar IPO in September. The filing caused a commotion in the crypto community as the mining giant was the first major crypto startup to file for an IPO. The company had also published their revenue figures after it submitted its IPO prospectus to the Hong Kong exchange. However, the exchange doesn’t seem to be convinced after the bear market storm that hit the market in November.
Additionally, Bitmain hasn’t published the revenue report for Q3, 2018. “If there’s a significant drop in their revenue, profits or loss, they have to disclose that. It’s something that worries the exchange,” said the source, according to the report.
The person said that the exchange was taking advantage of the current crypto market condition. “What they are doing is they are just dragging the case right now. If the market continues going up, the exchange may be pressured to approve the cases because how well the entire industry is doing. But because the market is down, these companies really have to justify [how] this industry is sustainable,” added the source.
Amid massive losses for the crypto mining industry and increased regulatory scrutiny, Bitmain is currently facing a $5 million class-action lawsuit for alleged unauthorized mining.
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