Bitcoin mining hardware manufacturers seem destined to be unable to complete their IPOs in 2018. A few days ago, Canaan creative allowed its filing to elapse signaling similar issues with other such companies with ICO plans.
2018 IPO Unlikely
In the middle of the year, it seemed all the big Bitcoin mining companies would go public before the end of the year. Bitmain, Canaan Creative, and even Ebang filed IPOs in Hong Kong. These developments came despite a struggling cryptocurrency market that was declining since the start of 2018.
Fast forward six months later and these plans all seem destined to remain up in the air. According to the Nikkei Asia Review, both Bitman and Ebang will most likely follow in Canaan’s footsteps by allowing their IPO filings with the Hong Kong Stock Exchange (HKEX) to expire.
Commenting on the present situation, the managing director of eToro Shanghai, Jasper Lee, said:
There is a very high chance that Ebang’s IPO application will lapse. Fundamentally, there is no big difference between Canaan and Ebang. If Canaan couldn’t respond to questions regulators have had, I don’t see how Ebang would be able to do so.
Canaan IPO Listing Expiration
On Friday, (November 16, 2018), Live Bitcoin News reported that Canaan Creative reportedly let its IPO application lapse. While there is no official word as to the reason at the moment, the consensus is that issues regarding disclosure and current market conditions are to blame.
Canaan already initially lowered its fundraising target from $1 billion to $400 million. However, this move wasn’t enough for the company to move forward with its IPO plans. With the continued price decline, it is possible that Canaan wasn’t able to prepare a new valuation in time for the deadline.
Regulatory Concerns
Apart from market fundamentals, some observers say that the regulators might not be too keen on cryptocurrency companies going public. This sentiment appears to hinge on the attitude of financial regulators to the industry in general. Commenting on the situation, the President of the Bitcoin Association of Hong Kong, Leonhard Weese, said:
I can imagine that regulators are putting a lot more scrutiny on cryptocurrency companies than they would on business models they understand. The sentiment is still that this is just a fad, and why allow companies to IPO that they believe will go bankrupt soon?
With all of these factors put into consideration, an IPO for any of these companies in 2018 seems almost impossible.
What do you think about the prospects of these companies not being able to complete their IPOs in 2018? Let us know your thoughts in the comment section below.
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