The first Initial Public Offering (IPO) of a bitcoin company has completed successfully in America according to SEC filings.
Canaan, the world’s biggest bitcoin mining manufacturer after Bitmain, sold 10 million shares at $9 each, raising $90 million as first reported on Bloomberg.
They hoped to raise $400 million initially, but lost the lead underwriter Credit Suisse Group AG.
The offering was instead led by Citigroup Inc., China Renaissance Holdings Ltd. and CMB International Capital Ltd.
The shares have began trading today on the Nasdaq Global Market under the symbol CAN.
Canaan’s stocks initially rose above $11, but are now below IPO price at $8.44 at the time of writing.
Bitmain is now to IPO too, with it unclear how much they will raise, while Coinbase has been rumored to be looking at an IPO since last year, but have not taken any action towards it.
As a public company, Canaan’s structure is now very different with its governance that of stock holders who depending on circumstances can exercise executive control by owning as little as 5% of total shares.
They will also have to engage in public disclosure of revenue and profits, with such disclosure potentially a good indicator of the bitcoin market presuming good management.
That means a Canaan stock can be sort of an indirect way of investing in bitcoin, but arguably more risky because the mining game can be quite ruthless.
A race between asics manufacturers has been going on this year in China, leading to a stratospheric rise in bitcoin’s hashrate as more and more computations are crammed into the same chip.
One slip, and a miner can fall from the race fairly easily, with miners announcing bankruptcy being a somewhat common occurrence in this space.
A $90 million chest may however give Canaan a nice cushion, but had it been a token instead they may have raised far more as it would have been a truly global offering and far more accessible for purchasing.