The company Ebang, dedicated to the manufacture of specialized equipment for Bitcoin mining, suffered a collapse in its actions. This company is one of the top four firms that make ASICs, and the second of its kind to be listed on the New York Stock Exchange.
Ebang recently started operations on Nasdaq on June 24, with an Initial Public Offering (IPO) of more than $ 100 million. In this way, according to the company itself, the proceeds would be invested in improving their equipment to make them more competitive.
At the same time, it was known that, before debuting in Nasdaq, the company would have suffered losses of more than $ 2 million dollars in the first quarter of the year. To make matters worse, there are now court cases against him. These are lawsuits that have brought the manufacturer to court.
Bitcoin mining hardware company is in court
According to the report that the company itself filed with the SEC, which is a requirement to enter the stock market. In it, it was learned that Ebang has three court cases open in China, one as a defendant and two as a plaintiff.
During the year 2019, the mining machine manufacturer Bitcoin, was sued for equipment delivery fraud. The client maintains that, from a purchase of 80,000 mining companies, he only received 56,000, which leaves a debt to the company of $ 57.9 million dollars. In addition, the other 24,000 machines did not comply with the sales protocols.
For its part, Ebang ensures that the ASICs were delivered as agreed with the buyer and filed a counterclaim. According to some media, it is in process.
As a plaintiff, the Chinese company accuses a client of approximately $ 10.5 million. In response, the client filed a counterclaim, claiming that it only received 65,000 of 90,000 Bitcoin mining devices.
To another of the clients that Ebang demands, the company asks for $ 4.3 million dollars. According to the client, the company has not finished delivering the equipment. In summary, these are a series of cases that have aroused mistrust in one of the main cryptocurrency dispenser manufacturers.
Stumbling on Nasdaq
After its debut on the New York Stock Exchange, the shares of the mining machine designer Bitcoin, in Nasdaq, plummeted 10% below their price and then presented a slight recovery in recent days. As a result, they remain below 8%.
Furthermore, the role of the Chinese media must be taken into consideration. These have maintained a constant propaganda offensive against Bitcoin mining. In this sense, this type of behavior by Ebang becomes a feast for these media, the vast majority of which are state-owned.
Another factor worthy of attention that could be affecting Ebang’s reputation on the New York Stock Exchange is the rejection it suffered on the Hong Kong Stock Exchange. In 2018, the manufacturer dedicated to Bitcoin mining prepared a list on this important Asian stock market.
In parallel, a group of investors sent a letter to Hong Kong’s financial regulators. In the letter, Ebang was accused of misappropriation of about $ 70 million dollars. This complaint caused the signature to be rejected on that exchange.
Data to consider
- Shares of mining equipment maker Bitcoin Ebang on Nasdaq are 8% below their listed price.
- Ebang is among the top four ASIC equipment manufacturers alongside Bitmain, MicroBT and Canaan Creatives.
- Ebang’s revenue in 2019 amounted to $ 109 million, just a third of what it earned in 2018. In both years, the company has reported significant losses.
- Canaan Creatives is the other Nasdaq-listed Bitcoin mining equipment maker.
The information in this content has been extracted from reliable sources detailed below:
1- Professional handling of content by the authors of CriptoTendencia.
2- External sources: investing.com, sec.gov, decrypt.co and zqrb.cn.