IPO, a Bitcoin miner, entered the countdown after filing a prospectus with the Securities and Exchange Commission ((SEC)) in April.
According to Golden Financial News, Yibang International will be listed on NASDAQ in the United States on June 26, 2020 under the stock symbol “EBON”. The bell will be rung at 21:30 Beijing time on June 26th.
This time, IPO will issue 19.3236 million Class A common shares at a price of between $4.50 and $6.50 each, raising about $87 million to $126 million. This listing will make Yibang International the second mining machine manufacturer to land on NASDAQ after Jiannan Technology.
Like Jiannan Technology and Bitmainland, Yibang International’s road to listing has also experienced twists and turns.
In 2015, Yibang International listed on the new third board, and its net profit rose from 24.2361 million yuan that year to 385 million yuan in 2017, a 15-fold increase in three years. In the first half of 2018, the company achieved revenue of about US $304 million and net profit of US $135 million, which was 8 times and 16 times that of the same period in 2017, respectively.
In February 2018, Yibang International announced its intention to list in Hong Kong. As a listed company on the new third board, Yibang International delisted from the new third board on March 23, 2018, and formally submitted an IPO prospectus on the Hong Kong Stock Exchange in June of that year, which expired in December of that year.
In the same month, Yibang International submitted a second listing application to the HKEx, which was still disclosed as invalid by the HKEx in June 2019.
In Hong Kong, Li Xiaojia, chairman of the HKEx, explained in a speech in January 2019 that it was not in line with HKEx’s core principle of “listing adaptability”. Whether it is the previous gold mining machine business, or want to transform the AI business, cryptocurrency mining machine manufacturers are unable to meet the “listing adaptability.”
In the latest prospectus, Yibang International pointed out that mining machine products are currently mainly designed for Bitcoin, so the performance has been and will continue to be significantly affected by Bitcoin price fluctuations. The recent global outbreak triggered market panic, which led to a sharp fall in Bitcoin in March, and the company expects business and operating results to be significantly negatively affected in the short term.
Go to the United States to “seek gold”
Dragged down by Luckin Coffee’s financial fraud, Chinese stocks as a whole are negatively affected by it, and it is the worst time for Yibang International to break through customs in the United States at this time.
What on earth is the reason why Yibang International can’t wait to list in the United States? — “it can only be said that Yibang International is really short of money and is in urgent need of listing and financing for hematopoiesis.” There are insiders in the industry on the golden financial analysis.
How short of money?
The future of mining machine manufacturers mainly depends on the bitcoin market and their own technological research and development strength. If the bitcoin market is in a bear market for a long time, there is no doubt that the operations of these miners will be seriously affected; but on the other hand, as long as a chip developed by a miner manufacturer has advantages in terms of power consumption and computing power, then you can cross the bull-bear cycle of bitcoin.
According to the official website of Yibang International’s mining machine brand, there are a total of 13 ore selling machine models ranging from E9 to E12, with prices ranging from 2000 yuan to 13200 yuan and computing power ranging from 2000 TH/s to 44 TH/s. Image.png.
According to the prospectus, 289950 mining machines of four models were sold in 2019, while 415900 were sold in 2018, although there were only three models, meaning shipments plummeted 30 per cent last year.
In addition, Yibang International’s mining machine products can not achieve head-on confrontation with other miners. Its wingbit E9 series, wingbit E10 series and wingbit E12 are all 10nm mining machines, while competitors have launched 7nm mining machines. And it is focusing on the research and development of 5nm Asic chips, it is still very difficult to make a breakthrough at this stage. After all, TSMC will not be able to complete the mass production phase of the 5nm process until the third quarter of this year.
Equally bad is that Yibang International’s R & D spending fell sharply in 2019, from $43.5 million in 2018 to $13.4 million in 2019. Although Yibang International pointed out in its prospectus that its latest 8nm and 7nm chip mining machines were completed in 2019, they have not been released to the public. In fact, Yibang International has not released a new mining machine product for nearly a year, and its latest Wybit E12 series mining machine was released in May last year.
In terms of revenue, the cryptocurrency has entered a bear market since the second half of 2018, and mining machine makers, including Yibang International, are not as good as they used to be.
According to the data, Yibang International achieved revenues of $319 million and $109 million in 2018 and 2019, respectively, meaning almost no revenue in the second half of 2018; gross profits of $24.4 million and-$30.6 million respectively; net losses of $11.8 million and $41.1 million, respectively, revenue fell 65.83% in 2019, and losses increased by 2.48 times.
Not only that, as of December 31, 2019, Yibang International had $13.74 million in other payables and $11.83 million in accounts payable.
Obviously, with these data alone, it will not be easy for Yibang International to win the favor of investors. NASDAQ:CAN, the mining machine’s first stock, faces at least two class-action lawsuits after short-selling reports accusing it of falsifying its listing documents. As of June 19, U. S. stocks closed at $1.94 a share, down to 14% of their offering price.
Now, market expectations for Yibang International are very low, with Jiannan Technology raising US $400 million and Yibang International raising no more than US $100 million.
The layout of the whole industry is not an easy task.
With the rebound in bitcoin prices, the most difficult time for the mining industry has passed, and mining machine manufacturers have ushered in a “respite” opportunity. In the first quarter of 2020, under the impact of the epidemic, Yibang achieved steady income growth, up more than 6% from the same period last year. But the net loss is widening further, from a net loss of $600000 in the first quarter of 2019 to $2.5 million in the first quarter of 2020.
The sharp decline in revenue from the main business makes Yibang International begin to look for new business growth points.
In the prospectus, Yibang International said that the company will launch a new generation of mining machines according to market conditions, and the mining currency of mining machines will expand to non-bitcoin; at the same time, the company will increase the development of mining machine escrow services. and digital currency exchange services outside China.
In the face of the still depressed digital money market, Yibang International does not seem to give up, but strives to enrich the company’s product line and service categories by laying out the upstream and downstream industry chains of digital currency, so as to reduce its dependence on Bitcoin and smooth the fluctuation cycle of digital currency. As for the effect, industry analysts said to Golden Finance: “the mining machine business has no advantages, so draw a big cake to show investors, vigorously develop mining machine trusteeship business, research and development of new mining machines, open encrypted currency exchanges, and so on.” in fact, these businesses are also very difficult to do well. “
Especially at a time when the regulatory policy on cryptocurrency trading in the United States and China is still unclear, it is undoubtedly a risky move for Yibang International to hastily lay out its exchange business.
Admittedly, in order to become the second share of the mining machine, Yibang International still has a lot of problems to solve.
A series of trust crises triggered by Chinese stocks have added some haze to the road of Yibang International’s listing in the United States. With the shortage of funds and the increasing pressure of peers, it is undoubtedly a dilemma for Yibang International to list in the United States at the moment.
As for the follow-up, we wait for it to change.