New CFO Aims to Double Ebang’s Revenue for 2020 By Launching an Exchange
One of the leading Bitcoin mining hardware manufacturers in China is looking to expand its business and nearly double its revenue this year, a Bloomberg report revealed yesterday. Ebang, the third largest ASIC producer in China after Bitmain and Canaan, has been set on taking over a bigger part of the global market as its two main competitors are busy with internal struggles and financial issues.
The company is planning to launch an offshore cryptocurrency exchange this year, its newly appointed chief financial officer Chen Lei told Bloomberg yesterday. The exchange will enable the company to expand beyond just the Bitcoin mining market, which suffers from huge volatility and is considered by many to be unsustainable in the long run.
Chen explained that Ebang is also planning to expand into datacenter management, a move that could enable it to increase its revenue around 40% this year. The company’s revenue could then double to over $200 million by the end of 2020 with the launch of the crypto exchange, he said, adding that without the exchange the company wouldn’t be able to hit that mark at least until 2022. This is a far cry from the company’s performance in 2018, when it reported around $300 million in sales.
Ebang has big plans for the upcoming cryptocurrency exchange—Chen revealed that he expects the exchange will initially account for around 10% of the total transaction fees of crypto trading across the entire market. This is an ambitious goal for the company whose hardware accounted for only 4% of the total TH/s sold last year.
However, such grand plans are in line with the company’s overall expansion strategy. As 8BTC reported earlier this week, Ebang International Holdings was listed on the Nasdaq under the ticker NASDAQ: “EBON.” The company raised $101 million in the initial sale, offering around 20 million shares for $5.23 each. The listing puts the company’s overall value at $685 million. While most of the raised funds will be used to set up mining farms which the company will be the sole user of, a large percentage of it will go towards setting up the offshore crypto exchange.
Chen told Bloomberg that the listing was a major win both for the company not only in a financial sense, but also in terms of marketing. Ebang’s brand will now be able to benefit from the fact that it’s listed on one of the largest exchanges in the world as the company seeks to draw more customers from the U.S.
At the time of writing, EBON is down 20% from the $5.23 listing price for the IPO. The stock market did not jump into buying spree after the exchange announcement.
Ebang will be the first large bitcoin hardware mining company to venture into cryptocurrency exchange business. The firm is under indirect pressure to innovate to avoid a fate like Canaan which saw its stock price plummet this year.