Bitmain Faces Salary Payment Suspension amid Financial Struggles

<p>Bitmain,
a manufacturer of Bitcoin application-specific integrated circuits (ASICs), has
temporarily suspended employee salary payments for September and beyond. The
move was made as the company is facing financial difficulties. This includes a lack of
positive cash flow for September and a decline in orders for new ASICs.</p><p>Internal Message from Bitmain:
The Reasons behind September Salary Pause</p><p>Multiple
employees at Bitmain disclosed these developments anonymously. They stated that
the firm has cut all "bonuses and incentives" for its staff. It also
imposed a reduction of 50% in their base salaries. </p><p>Bitmain allegedly stated in an internal message: "For
the month of September, the company has yet to achieve a net positive cash
flow, especially in the orders of [new] ASICs. The Executive Management Team
therefore decided that salaries for the month of September will be paused, to
be reviewed after October 7 after the holiday."</p><p>Volatility in Crypto and
Mining: Challenges Faced by Bitmain</p><p>Founded
in Beijing in 2013, Bitmain has been one of the major players in the Bitcoin
mining industry. During its peak, it held an estimated 70% market share in the
Bitcoin mining ASIC manufacturing sector. Bitmain's Antminer ASIC series has
been a leader in terms of hash rate computations for Bitcoin mining. The
situation at <a href="https://www.financemagnates.com/tag/bitmain/">Bitmain</a>
has raised concerns among its employees and stakeholders as the company
navigates <a href="https://www.financemagnates.com/tag/financial/">financial</a>
challenges.</p><p>Bitcoin
miner Hive recently announced its acquisition of 2,000 Bitmain S19 XP ASIC
miners for immediate deployment to its <a href="https://www.financemagnates.com/tag/mining/">mining</a> rigs. These
miners, listed at a price of $4,653 on Bitmain, are expected to contribute
significantly to Hive's mining operations, generating an estimated $80 per
megawatt hour in revenue.</p><p>Bitmain,
once led by Jihan Wu, the Co-Founder, settled a year-long ownership dispute in 2021
with the Co-Founder, Micree Zhan. As part of the agreement, Wu resigned as the Chairman
and CEO of Bitmain. He sold his ownership stake to Zhan for $600 million. Bitmain
had initially planned for an initial public offering with a valuation of
$5 billion by late 2022. However, these plans appear to have been shelved due
to the ongoing bear market in the <a href="https://www.financemagnates.com/tag/cryptocurrency/">cryptocurrency</a> industry.</p><p>The
pause in employee salary payments and financial challenges at Bitmain have highlighted the volatile nature of the cryptocurrency and mining industries. The market
conditions can significantly influence industry players. Bitmain's future
prospects will likely depend on its ability to navigate these challenges
successfully.</p>

This article was written by Tareq Sikder at www.financemagnates.com.