Cryptocurrency mining firm Canaan has stepped away from its planned IPO…
Notwithstanding the fact that cryptocurrency prices have taken pretty much a battering across the board over the past 24 hours, there had already been a growing number of reasons for many to move away from cryptocurrency mining. Likely the most potent is the simple fact that it’s not as lucrative as it once was, even less so today, with the price of Bitcoin for instance over 70% down from its absolute peak.
Furthermore, there are growing environmental concerns over the amount of electricity that cryptocurrency mining demands, and just what impact that has on the planet longer term.
One company that’s made a good living out of manufacturing cryptocurrency mining equipment is Canann Inc. The Chinese firm was doing well too, to the point where it aimed to float itself on the Hong Kong stock exchange. An initial target of some $2bn was mooted, although that eventually settled down at around $400m instead. Nonetheless, the necessary application was filed back in the spring.
And then nothing happened.
Now we learn that the application for an IPO has actually lapsed. The fall in the price of crypto is one reason. But another is said to be growing emphasis from regulators around the sector as a whole. In the case of Canaan’s IPO, questions were being asked about the plans for the business going forward, in line with the increased general interest from said regulators.
This doesn’t mean that Canaan’s IPO is completely dead, incidentally. Rather that if it wanted to go ahead now, it’d have to file its application again and take things from there. Bitmain also has an IPO application filed, and it remains to be seen if it presses ahead.