Bitcoin-Mining Chipmaker Bitmain Halts Payments to Employees

Bitcoin
(Image credit: Tom's Hardware)

Bitmain, one of the world's largest suppliers of cryptocurrency mining ASICs, has temporarily halted salary payouts from September, ceased all staff bonuses, and is considering a 50% cut to basic wages due to financial challenges. Additionally, plans for an initial public offering (IPO) have been put on hold, reports CoinTelegraph.

Bitcoin has lost its value in the recent quarters, which made Bitmain's products far less attractive to smaller players. Meanwhile, large miners continued to buy them. For instance, Hive, a significant player in Bitcoin mining that also happens to deploy Intel's mining ASICs, recently acquired 2,000 units of Bitmain's S19 XP ASIC miners. Each of these devices carries a list price tag of $4,653, though it is unclear how much Hive paid for them. After integrating these devices, Hive reportedly anticipated its tools to yield a revenue of $80 per megawatt hour, which encompasses earnings from both Bitmain and other models. 

Beijing-based Bitmain is one of the world's largest makers of cryptocurrency mining hardware that reportedly commanded 70% of the market and even managed to obtain priority access to TSMC's production capacities. The company's Antminer ASIC line is recognized for its hash rate efficiency in mining Bitcoin. Their standing in the market was so formidable that many in the industry considered their products the gold standard. 

But 2019 and 2020 were tumultuous years for Bitmain and its leadership. A protracted conflict between its co-founders, Jihan Wu and Micree Zhan, reached a climax in 2021, which the duo finally settle: Wu agreed to step back from his chairman and CEO roles and sell his company stake to Zhan for $600 million. 

Amidst these corporate shake-ups, Bitmain had eyed an aggressive growth strategy. In 2021, they were gearing up for an initial public offering (IPO) with aspirations of achieving a whopping $5 billion valuation by the close of 2022. However, the ongoing financial downturn in the market seems to have dashed these plans, at least for the foreseeable future.

Anton Shilov
Contributing Writer

Anton Shilov is a contributing writer at Tom’s Hardware. Over the past couple of decades, he has covered everything from CPUs and GPUs to supercomputers and from modern process technologies and latest fab tools to high-tech industry trends.

  • helper800
    Another coin related business sinking to the bottom of the ocean.
    Reply
  • punkncat
    We played around with a bit of coin, think it was Coinbase that we used. That "app" has not allowed us to log in for days now. IDK if they are going this same way or just some internal issue on our side. Luckily, we didn't invest very heavily, mostly just played around with it to watch. Where I hate to lose ANY amount of money, we certainly didn't hurt ourselves playing into it like some friends and acquaintances did.
    The person who owns the house where our son rents lost pretty much everything and had to turn around and sell the house. They were right in the middle of a huge remodel and refit of the bathrooms. Eeks!
    Reply
  • vanadiel007
    I bet the CEO now regrets paying the other co founder $600 million USD to buy him out.
    Reply
  • helper800
    punkncat said:
    We played around with a bit of coin, think it was Coinbase that we used. That "app" has not allowed us to log in for days now. IDK if they are going this same way or just some internal issue on our side. Luckily, we didn't invest very heavily, mostly just played around with it to watch. Where I hate to lose ANY amount of money, we certainly didn't hurt ourselves playing into it like some friends and acquaintances did.
    The person who owns the house where our son rents lost pretty much everything and had to turn around and sell the house. They were right in the middle of a huge remodel and refit of the bathrooms. Eeks!
    I cannot help but think that if you are willing to play with fire and get burned you have no one but yourself to blame. I have also personally seen people lose their livelihoods and everything they owned because of this unregulated pump and dump or rug pulling utopia. It is really hard to not sympathize with those people...
    Reply
  • punkncat
    helper800 said:
    I cannot help but think that if you are willing to play with fire and get burned you have no one but yourself to blame. I have also personally seen people lose their livelihoods and everything they owned because of this unregulated pump and dump or rug pulling utopia. It is really hard to not sympathize with those people...

    IDK, there was a period of time there that this really looked as if it would take off and be something. I am sure the folks who held on to Bitcoin from the first 'sensation' of this were mighty happy it came back around. It well could turn around again, but seems there will be a lot less players going in this deep.

    For sure, there are several powers that be that are more than glad to see it fail, and may well be working in the background to help assure it.
    Reply
  • helper800
    punkncat said:
    IDK, there was a period of time there that this really looked as if it would take off and be something. I am sure the folks who held on to Bitcoin from the first 'sensation' of this were mighty happy it came back around. It well could turn around again, but seems there will be a lot less players going in this deep.

    For sure, there are several powers that be that are more than glad to see it fail, and may well be working in the background to help assure it.
    I am a very risk averse person, so I never got into mining or coins of any type. I am also not saying I would not have been duped if I had, I m not some prophet, however, I did see the potential for scamming once the blockchain was released and people started putting monetary value on coins. The people that made most of the money on coins were in on it very early on before any bandwagoning started. They held their coins without selling until they were worth hundreds to thousands each. I know of one such person who made millions, but that is in contrast to the four others who lost close to 1.5 million combined.
    Reply
  • DavidLejdar
    helper800 said:
    I am a very risk averse person, so I never got into mining or coins of any type. I am also not saying I would not have been duped if I had, I m not some prophet, however, I did see the potential for scamming once the blockchain was released and people started putting monetary value on coins. The people that made most of the money on coins were in on it very early on before any bandwagoning started. They held their coins without selling until they were worth hundreds to thousands each. I know of one such person who made millions, but that is in contrast to the four others who lost close to 1.5 million combined.
    Yeah, the amount of cryptotokens keeps increasing (not calling it "cryptocurrency", as that implies it is a currency, which it isn't), while the amount of RL money doesn't at such rate. I also didn't see how that was supposed to work out.
    Reply
  • JTWrenn
    This type of coin mining should be outlawed. It's such a low hanging fruit for global warming. Force all crypto to go to stake based or some other low power system and we will save everyone a lot of headache.
    Reply