Will Bitmain Liquidate Its BCH and LTC Holdings to Trigger a Bearish Trend?
Of late, there are rumors circulating Bitmain, the demonstrated mining hardware manufacturer, is laying off a substantial number of their employee. Although the firm has refuted the layoff rumor on Monday, saying that it is a normal staff turnover based on their business performance, it still caused turbulent and in-tranquil discussion within the community.
The original discussion initially emerged on Maimai, China’s equivalent to LinkedIn. A verified Bitmain staff disclosed on Sunday that “the layoff will start next week and involves more than 50 percent of the entire headcount.”
Bitmain admits the firm is undergoing “some adjustment” to their staff this year, in order to build a sustainable business but denies the “mass layoff”.
As laying off is an ongoing process, it is still unclear how many people would be impacted and the accurate percentage was not able to be verified.
However, Samson Mow, CSO of Blockstream tweeted on Tuesday that, Bitmain layoffs are likely to be as high as 85% instead of 50% and all non-essential business units are cut.
Reports in China are now saying that Bitmain layoffs are likely to be as high as 85%, not 50%. All non-essential business units are cut. Teams working on AI initiatives are decimated. #BitmainIPO https://t.co/wOrfUYukpg
— Samson Mow (@Excellion) December 26, 2018
This news cause anxiety among BCH and LTC holders as Bitmain still holds a lot of those two cryptocurrencies and there might be a large possibility that the firm would dump their coin holding for layoff compensation.
Kyle Samani, the co-founder of crypto fund Multicoin Capital, tweeted that as Bitmain holds a significant amount of BCH and LTC, the ongoing layoff may lead to Bitmain liquidating its holding in these coins.
This is extremely bearish for BCH and LTC
The only reason to make cuts this drastic are because you're about to run out of cash
Meanwhile, they still have 1 BCH and 1M LTC on their balance sheet. Those are going to be liquidated soon to keep the lights on https://t.co/kneSRcK2li
— Kyle Samani (@KyleSamani) December 26, 2018
Although Bitmain’s current holding still remains unknown due to the previous BCH fork, a leaked financial document in August suggested that the firm held 1,021,316 BCH and 930,923 LTC in a financial document.
The recent crypto crash, as well as the decreased demand for mining devices, makes Bitmain suffers a lot. The currency layoff may trigger a bearish trend of the BCH and LTC market. As most people believe that Bitmain will liquidate its holdings in an extremely hard time when they run out of cash.