Jihan Wu is known for being a pioneer in the crypto industry. Years back, he founded Bitmain and helped turn the company into the world's largest mining equipment manufacturer.
A year on from his bitter spat with the company he helped found, Wu is ready to take the mining space by storm once more.
Bitdeer is Poised to Take the Mining World by Storm
A few days ago, Bitdeer Technologies Holding Company, a Bitcoin mining firm based in Singapore, announced it was going public. The company agreed to merge with the special purpose acquisition company (SPAC) Blue Safari Group Acquisition Corp.
Under the terms of the deal, the merger will be named Bitdeer Technologies Group. Wu, who currently serves as Bitdeer's chairman, will lead the resulting company once the merger is complete.
"As a leader in crypto mining, we will continue to solidify our leading position in the crypto mining space. Today marks a significant milestone for Bitdeer, and we strive to create value for our broader group of stakeholders in the future, including our clients, employees, and shareholders," Wu said in the statement.
Bitdeer has grown significantly in the past year, establishing five Bitcoin mining data centers across the United States and Norway. The merger will position Bitdeer as a significant player in the mining space, the resulting company holding a $4 billion valuation.
All systems appear to be in check, with both companies' boards approving the merger. Barring any hiccups with regulatory approval and shareholder sign-offs, the new company should list on the NASDAQ exchange in the first quarter of 2022.
An Ugly Breakup
Bitdeer marks a significant turning point for Wu. The company is a spinoff of Bitmain Technologies, which Wu founded in 2013 with partner, Micree Ketuan Zhan. Under the leadership of both men, Bitmain grew to become the world's largest manufacturer of Bitcoin mining hardware.
An internal power tussle turned things sour in December 2019, when Wu suddenly ousted Zhan from Bitmain. In a shocking move, the company made an announcement to employees confirming that Zhan had been ousted and communications should cease.
But, Zhan was Bitmain's largest individual shareholder at the time. He immediately began fighting for what he believed to be his company.
Bitmain went on the offensive. The company stated publicly that Zhan had no links to Bitmain and would not serve as the company's legal representative. Striking back, Zhan launched two separate lawsuits against several subsidiaries of Bitmain. He specifically accused Wu of circulating false stories, hiding company assets, even threatening his safety.
After months of back and forth, both parties eventually came to an agreement. A letter shared with Chinese media outlets showed that Zhan still claimed to own 36 percent of shares in Bitmain's Cayman Islands-based parent company, putting his voting power within the company at 59.6 percent.
In the letter, Zhan offered to buy out Wu and other outside investors. The co-founder offered compensation totaling $4 billion for the employee pool and three unnamed individual investors.
Wu and Bitmain rejected the offer, but it served as the eventual catalyst for the deal.
Both parties agreed to a settlement in December, with Sequoia Capital acting as the mediator. Under the terms of the deal, Zhan would vacate his position as Bitmain's head, taking with him a $600 million payday, Bitmain's overseas mining centers, and the company's BTC.Com mining pool.
Zhan must retake his CEO position, maintaining Bitmain's Chinese mining farms and the Antpool mining pool. He will also oversee Bitmain's artificial intelligence division and mining hardware manufacturing business. He forked over the $600 million needed to buy out Wu's stake, ensuring he had complete control of Bitmain.
Time to Move On
Wu appears to have done pretty well so far. He fine-tuned Bitdeer and is on the fast track towards a public debut. Meanwhile, Bitmain has struggled in China thanks to the government's blanket ban on cryptocurrency activities.
Bitmain and other companies in China's mining space have famously been left out of the Chinese government's crusade against crypto. But with Beijing turning its ire towards mining, there's been no escape. The company will land on its feet, but will undoubtedly be affected.
Bitmain already tried to list on stock exchanges twice to no avail. Its first attempt to list on the Hong Kong Stock Exchange (HKEX) lapsed in March 2019. It was reported to be weighing another IPO this year, but nothing has materialized so far.