Canaan Mining Plans New York IPO for November 20

The IPO of Canaan Mining is viewed with mixed emotions, seen as either a breakthrough or an attempt to secure funds.

Canaan Mining, one of the leading producers of specialized Bitcoin (BTC) mining equipment, has filed documents for a November 20 IPO on NASDAQ. The company will trade under the ticker CAN, and will seek $400 million. The decision to try a US-based listing arrives after Canaan decided against a Hong Kong listing and IPO last year.

Previously, Canaan has relied on private placements, potentially valuing the company at “billions of dollars”.

Canaan Mining succeeded where its chief competitor Bitmain was met with difficulties. The company posted robust earnings for its Q3 results, potentially making the IPO more appealing. At the same time, Bitmain has scrapped its IPO plans, while going through internal turmoil and a shift in leadership.

Bitcoin mining has remained a significant source of income and new coins in 2019, as activity picked up significantly and mining is nearly 20 times more active in comparison to late 2017, when BTC held a record price rally.

Canaan posted more than $13 million in Q3 earnings, based on renewed demand for mining rigs as BTC prices moved to levels where mining is above breakeven. The net result is 40% higher year-on-year, signalling significant recovery in the crypto mining.

The November 20 IPO will arrive at a time when BTC market prices have entered another period of fear and uncertainty. BTC sank once again, so far trying to defend the $8,800 tier.

At the current prices, the profitability of some of the Avalon miner models has fallen. At current valuations, an Avalon ASIC has a net loss of around $717 per year. Mining BTC, however, is not only about selling, but about securing some of the last brand-new coins that will become more scarce after May 15.

The Canaan Mining IPO will also signal the potential interest of US traders for Bitcoin-related activities. BTC has reestablished itself as a source for gains and hedging, though the price fluctuations and mining risks still remain.

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