According to a recent tweet by one of Bitmain’s most loyal Twitter followers, BTCKING555, the company’s third-quarter financial figures revealed a $740 million in losses. Even though Bitman, one of the largest China-based manufacturers of crypto mining equipment, has not revealed any official figures up till now, but with crypto miners quitting in thousands, this figure doesn’t look much surprising.
The tweet mentioned a leak, and called the financial figures they received for the Q3 a “complete disaster”. If true, this makes Q3 losses the worst for Bitmain. It also makes it the second consecutive quarter with heavy losses for the company this year.
BTCKING555 later also mentioned a possibility of further losses to $1 billion in total, in inventory, bitcoin cash, and an investment Bitmain recently made in Bitcoin BCH, that immediately went into price depreciation after Bitmain made the investment. Bitcoin BCH has now lost half of its value since Bitmain investment.
Even though this is yet a rumor, as there is no official data released by the company, but with recent trends in crypto mining industry, and devaluation of cryptocurrencies Bitmain has recently invested in, not many in the industry doubt this figure.
Bitmain, which is also ranked as the world’s largest crypto miner, is quickly turning into a disaster from a success story that baffled many. However, Bitmain has no one but itself to blame for the losses.
It was also involved in some fishy business practices in the last few months. For example, when preparing for their upcoming IPO, Bitmain tried to lure in investors by falsely claiming that their upcoming IPO is backed by some of the largest international companies. The claim was later proved to be false and caused a delay in the launch of IPO which was due back in September.
Financial losses and delay in IPO launch are not the only problems Bitmain is facing right now. They are also facing a class-action lawsuit in the US for using customer equipment for mining without informing the customers or sharing profits with them.
All in all, once the leading miner and story of success, Bitmain apparently is falling apart very quickly. Their dubious business practices and deliberate attempts to falsify data have now cost them customer’s trust. Even though most of the information is still allegations or rumors, but if you are an investor, you need to think twice before investing in Bitmain.