Blockstream Unveils Mining Facilities and A Collocation Service

Blockstream, a leading blockchain technology platform based in Canada, has just launched Blockstream Mining, a mining collocation service, along with the mining pool. The company made an official announcement through a blog post published on August 8.

Through the blog post the company revealed two massive data centers for enterprise class collocation services, along with Blockstream Pool, using the BetterHash protocol. This solves a key issue with many mining pools, in which the pool operators determine which transactions to include. Hence decentralization is increased, and potential attacks on the network become much more difficult.

Blockstream’s mining data center will host its clients’ mining activities in addition to Blockstream’s own mining operations.

In addition to that, this collocation service will allow businesses complete mining operations monitoring and control as well as the option to manage them remotely. The blog further denotes that there is a qualified team on deck to handle all the requirements: from the safe shipment of the mining equipment and reliable installation to real-time control and analytics to on-site tech support.

Currently, the service is available only to institutional and enterprise customers. However, the company has stated that operations support, along with more services, geared towards individuals as well as small businesses, will be soon added. The mining facility counts Fidelity Center for Applied Technology and LinkedIn co-founder Reid Hoffman as one the first clients of their new mining service.

According to the blog post, Blockstream Mining will provide mining equipment collocation service in the firm’s data centers – Quebec and most recent one, Georgia – as well as all over North America. The data centers account respectively for a combined 300 megawatts of energy capacity. At full capacity, populated with the latest mining rigs, this could account for around 7.5% of the entire network hashrate.

Blockstream CSO Samson Mow has disclosed that the platform’s mining efforts were mostly based on concerns about the network’s future:

“We began self-mining back in 2017 after being motivated by widespread concern that mining decentralization was declining. At the time it appeared that parties involved in ASIC manufacture, hosting, and pool operations were becoming a centralizing force and holding back Bitcoin from reaching its full potential. We figured we could use our Bitcoin expertise to improve the situation.”

Meanwhile, Blockstream has previously raised $90 million from investors including Khosla Ventures, AXA Venture Partners, and Reid Hoffman. The firm has launched a line of varied products and services. For instance, Blockstream has been busy lately, developing its Liquid sidechain project, bringing speed and cost benefits to the Bitcoin network.

Other products made available for customers include Blockstream Green – a mobile Bitcoin wallet, as well as the Blockstream Satellite, which is a 24/7 service enabling users to broadcast and receive Bitcoin transactions and blocks from satellites.

Chinese Mining Company Canaan Reportedly Applies for IPO with the US SEC

Canaan Creative, one of the largest manufacturers of Bitcoin miners in China, has allegedly filed an application for a $200 million initial public offering (IPO) in the U.S.

The news was reported on July 31st via a blog posting on local social media platform – WeChat – by an official account named “IPO Zao Zhi Dao,” claiming that the company had already secretly submitted the application with the U.S. Securities and Exchange Commission (SEC).

According to people with knowledge of the matter, the Chinese manufacturer is seeking to raise $200 million through the public listing. Despite being less known in the west than its competitors such as Bitmain, Canaan is one of the three main Chinese Bitcoin mining players, the third being Yibang International.

Canaan’s first attempt to go public was during March 2018 when the Chinese manufacturer was seeking to file for a $1 billion IPO on the Hong Stock Exchange. However, the plan was later dropped by the company and the company’s Hong Kong Stock Exchange IPO application became void in November 2018.

Earlier this year, there were reports that Canaan was considering an IPO in New York, although the process was in its early stages. According to SEC’s new rules implemented in July 2017, companies in the US can make confidential filings of any size. The changes were made in an effort to encourage more IPOs. Prior to that, only smaller companies were allowed to file private applications.

In March, it was reported that the firm was considering an IPO attempt on the newly created Science and Technology (Sci-Tech) Innovation Board within the Shanghai Stock Exchange, in addition to its talks with the New York Stock Exchange and NASDAQ.

Notably, in March Canaan Creative had raised additional capital in its latest funding round, however the exact amount was not made public. The funding came from all existing backers as no new investors reportedly came on board. Following this news, this would make Canaan as the first Chinese market participant to successfully take its case to the U.S. market.

Meanwhile, Canaan is not the first Bitcoin (BTC) manufacturer to consider filing an IPO. Cryptocurrency mining giant Bitmain had earlier filed for an IPO, however failed to make a bid with the Hong Kong Stock Exchange. Following that, Bitmain was reportedly considering filing an application in the U.S. with the SEC as of the end of June. Rival mining manufacturer Yibang’s attempt at filing an IPO with the Hong Kong Stock Exchange had also met with rejection.

At the time of Bitmain’s failure in December 2018, many strongly believed that the then highly volatile nature of BTC was the reason which gave regulators cold feet. The month prior to that, mining had suffered as BTC prices plunged, leading to significant shifts as participants attempted to stay financially stable.

Six months later, the landscape had transformed, with Bitcoin seeing a dramatic reversal of fortunes across the mining industry.

Bitfury and Final Frontier Launch Bitcoin Mining Fund

Final Frontier in collaboration with Bitfury announced the launch of a fully regulated Bitcoin mining fund, following authorization by a European financial regulator.

Bitfury, which develops blockchain-related software along with providing mining equipment and services, confirmed that Final Frontier had gained regulatory approval for the fund. Final Frontier is a specialist investment firm focused on innovative technologies.

The fund has been conceived with the aim to provide institutional and professional investors convenient access to Bitcoin mining, according to the blog post released on Wednesday.

Access to mining facilities or exposure to mining operations has been riddled withtechnological, logistical, financial and execution risk challenges. With that in mind, the company wants to address those challenges with an offering that has been authorized by a European financial authority.

According to the announcement, the fund will invest in turnkey assets consisting of mining sites across the globe, where electricity and operating costs are low. Bitfury will have a big role to play in exploring opportunities and conducting the operating activity. Bitfury will provide the hardware for the project, which will also leverage the company’s various mining centers to source power and deliver favorable mining costs.

Final Frontier co-founder, Imraan Moola sees this as an opportune time for investors that have an interest in having exposure to cryptocurrency markets, stating:

“With the bitcoin price down significantly from its all-time high, yet institutional interest growing every day, now may be an opportune time to consider investing in bitcoin mining.”

At the same time, Bitfury’s executive George Kikvadze said that the fund will help investors strengthen their portfolios and bring Bitcoin closer to mainstream adoption.

Earlier this year, Bitfury partnered with South Korean R&D firm Commons Foundation to jointly launch a network of Bitcoin mining operations in Paraguay.

Bitfury is also reportedly considering an initial public offering (IPO) in Amsterdam, London or Hong Kong, possibly to be held this year. The firm raised $80 million in November, in a round led by venture capital firm Korelya Capital, with Mike Novogratz’s Galaxy Digital, Macquarie Capital and Dentsu Inc. also participating.

Bitmain IPO Filing Update Hint at Possible Losses in Q3 2018

Cryptocurrency mining giant Bitmain could have made losses of around $500 million in Q3 last year, according to revealed filing documents of the company.

The Beijing-based company recently provided an update on its financial results to the Hong Kong Stock Exchange (HKEx), which is reviewing Bitmain’s application for an initial public offering (IPO) first filed in September.

According to documents, for 2018 as a whole, excluding Q4, revenue was $3 billion and profits $500 million. This changed significantly in comparison to previous figures for the first half of the year, for which profit was $1 billion.

If the approximated figures are accurate, the conclusion is that Bitmain made a loss of around $500 million in Q3, confirming that the Bitcoin bear market late last year had a hard-hitting impact on the mining sector.

Further, the update provided to HKEX showed Bitmain’s cryptocurrency holdings dropping in value and unverified reports claiming that the amount of assets has also decreased.

The company’s IPO application, filed in late September, indicated that Bitmain mainly held Bitcoin, Bitcoin Cash, Ethereum, Litecoin and Dash, although it did not provide a breakdown of how much it held of each asset.

Bitmain’s IPO filing process, which could raise significant funds for the company, has been fraught with difficulties since the plans have started to make headlines in the cryptocurrency industry in Q2 2018.

HKEX itself added to the doubts in December, with rumors claiming the exchange was unwilling to approve any cryptocurrency offering due to the industry’s volatile nature.

Bitmain had already signaled it had fallen on harder times with layoffs and office closures around the world beginning at the end of the last year that affected almost every unit of the company. Its main businesses are manufacturing mining equipment and operating mining farms and pools – activities that have broadly suffered from the slump in crypto prices.

In the beginning of the year, the company has also undergone a switch at the helm of the company. Jihan Wu has stepped down as CEO, to continue as Chairman, while someone from inside the company has taken his place.

Bitmain’s Downscaling Continues as Projects in the U.S. Get Revamped

In most recent news, Chinese leading mining and mining ASIC hardware producer Bitmain has apparently suspended all of its mining activities in their US based headquarters in Rockdale, which is situated in the Milam County east of Austin in the state of Texas.

Bitmain Layoffs

Steve Young, a Milam County Judge, published a statement reporting that all Bitmain employees apart from two engineers and the director of human relations had been laid off, thus rendering all operations suspended.

According to the official report, the judge disclosed later that Bitmain told him that the company would scale down in terms of operation as opposed to the firm completely shutting down. Thereupon, it will involve now a total of five employees, whereas initially it was composed of 15 employess.

In addition to that, Judge Young stated as well that Bitmain had spent millions just to renovate its buildings, further suggesting that the firm now boasts between 7,000 and 8,000 servers.

The county judge claims that it is due to the collapse of Bitcoin’s price as a reason for the revised plans which led the company to lay off most its staff and halt their mining operations.

A Bitmain spokesman cited that

“The right-sized team at Rockdale now has the expertise to re-start the project at small scale anytime. Bitmain would like to ramp up the site at a slower pace and scale based on market conditions.”

The Milam County Judge Young has also talked about the company’s commitment to hire locally and Bitmain insisted on paying the school district taxes as opposed to taking an offered abatement. According to the article, the question remains concerning the 10-year tax break on county taxes on real and personal property.

Big Plans Disrupted by Markets

As previously reported, Bitmain wanted to develop a blockchain data center worth $500 million. This – including a mining facility – would have been built in Texas as part of the company’s goal to expand further into the United States market.

Apparently, media outlets have recently confirmed that Bitmain has been planning to let employees go from various projects. In December 2018, it was reported that Bitmain and major crypto exchange Huobi have apparently affirmed plans to lay off staff. Also in December, news broke out that Bitmain was closing its development center in Israel and letting local employees go.

Furthermore, several Chinese commentators have also claimed that Bitmain has let go of its entire team of Bitcoin Cash (BCH) developers.  It is interesting to see just how this would affect the company’s future, given its presence in the crypto industry.