The cryptocurrency mining and hardware production company Ebang has just filed for a $100 million USD initial public offering with the US SEC. This filing not only shows the there is a market for Bitcoin mining, but that the industry in high demand. Ebang’s annual revenue is $109 million last year, despite falling cryptocurrency prices. The annual production of Bitcoin is worth $3.5 Billion USD at current Prices. Miners need new hardware as new chip technologies, such as those produced by Ebang, is both more powerful and energy efficient. In 2019, 82% of Ebang’s revenue came from application-specific integrated circuit (ASIC) chips.
Moving to 10nm production is expensive
One of the reasons for Ebang going public is to move to even more advanced technology and production techniques. In chip manufacturing, moving to smaller node sizes, such as 10nm makes the miner more powerful and power efficient. Ebang’s new mining chip, the DW1233 is independently developed and based on the new 10nm production process.
Although the Bitcoin price started to recover in the second quarter of 2019, our operations generally lag behind the increase of Bitcoin price.Ebang Press Release
Failed IPOs and Second Chances
This is Ebang’s second attempt at an initial public offering, after they failed to file for an IPO with the Hong Kong Stock Exchange (HKEX) in 2018. The initial IPO was not granted by the HKSE after 6 months of application, indicating it was not accepted by the HKEX. This time around Ebang has a smaller raise of $100 Million USD as opposed to the first filing, which valued the company at $1 Billion dollars.
Cryptocurrency mining ecosystem
Large cryptocurrency mining hardware manufacturers have all been seeking Initial Public Offerings as a method to raise capital for expansion. Part of the reason is the growing market Bitcoin and cryptocurrency ecosystem.