Bitmain, Chinese Bitcoin mining giant and producer of mining hardware, is expanding its reach and has set up a new subsidiary in Switzerland.
Local Swiss publication Handelszeitung reported that the subsidiary, Bitmain Switzerland, was registered in Zug last month, to Bitmain co-founder Jihan Wu, Ti Liu (a Chinese national residing in Birrwil), and Christian Johannes Meisser (a Swiss national residing in Klosters-Serneus), according to commercial registry filings.
Zug, a small Swiss canton, has earned the title “Crypto Valley”, as relaxed regulations have made it the location of choice for numerous cryptocurrency and blockchain companies to set up their HQs. According to Handelszeitung, Bitmain claimed its new European branch “will play a key role in our global expansion”.
Bitmain’s move into Switzerland comes in the wake of a cryptocurrency crackdown in China. Following bans on cryptocurrency exchanges and initial coin offerings, the government and central bank are now reportedly moving to restrict power supply to Bitcoin miners. Reports suggest that the aim is to guide Bitcoin miners toward an “orderly exit” from their businesses in the country, as they have “consumed huge amounts of resources and stoked speculation of ‘virtual currencies’”.
Bitcoin mining is an energy-intensive activity, and the growing demand for cryptocurrencies means the demands on the network are also increasing. China had long been a hub for miners owing to the availability of abundant and cheap power supply – however, in the wake of recent developments, miners will be forced to take their businesses elsewhere.
In addition to Bitmain, mining pools BTC.Top and ViaBTC are also shifting their operations; the former will be moving to Canada, while the latter has operations in Iceland and the US. Bloomberg reported that BTC.Top founder Jiang Zhuoer claimed they chose Canada owing to “the relatively cheap cost, and the stability of the country and policies”.