- Bitmain is going through a power struggle between its main founding members.
- Jihan Wu told Bitmain’s staffers that Micree Zhan was being laid off.
- Zhan said he was ousted without consent and is prepared for a legal battle.
Bitmain Co-Founder Micree Zhan was recently forced out of the firm without any consent or prior knowledge. Now, the world’s richest crypto billionaire is preparing to go to court, if necessary, to guarantee his return to the mining giant.
A civil war has been taking place at Bitmain over the last few years. Two of its main founding members, Jihan Wu and Micree Zhan, have been locked up in a leadership dispute. The conflict caused Zhan to get ousted from the firm without any consent or prior knowledge.
Last week, Wu reportedly sent an email with a subject “important notice” to all Bitmain employees. The statement revealed that Zhan was leaving the firm and was dismissed from all of his roles.
The email reads:
Bitmain’s co-founder, chairman, legal representative, and executive director Jihan Wu has decided to dismiss all roles of Ketuan Zhan, effective immediately. Any Bitmain staff shall no longer take any direction from Zhan, or participate in any meeting organized by Zhan. Bitmain may, based on the situation, consider terminating employment contracts of those who violate this note.
A leaked transcript of an internal meeting revealed that the decision was based on a series of disagreements. These issues were affecting the financial success of the mining giant. According to Wu, the company was spending “unnecessary and hasty investment.” In addition, the Bank of Beijing retracted from a credit line that was already approved. The ruling was based on suppliers calling for clearing accounts payable.
Now, Wu has taken over the roles of executive director and legal representative of Bitmain from Zhan. But, the latter will not give up easily.
In an open letter posted on his WeChat account, Zhan said that he was removed from the company without his consent and plans to resolve the issue as soon as possible.
I have never thought that as a person focusing on technology and product, I have to start thinking from legal perspectives. It was embarrassing that as a Bitmain co-founder, the biggest shareholder, and a registered legal representative, I got ousted without any knowledge in this coup while on a business trip.
Zhan reaffirmed Bitmain employees and shareholders that he would return to the company even if he needs to take legal actions.
Bitmain is our child. I will fight for her until the end with legal weapons. I won’t allow those who want to plot against Bitmain to succeed. If someone wants a war, we will give them one.
What’s at Stake?
Jihan and Micree are fighting to take control over Bitmain. This is the world’s largest manufacturer of ASIC chips, which are essential for bitcoin mining. ASIC chips have the ability to improve mining operations due to their high efficiency and low energy consumption.
The company also operates BTC.com and Antpool, which are two of the largest mining pools for bitcoin. These two Chinese-based mining pools commanded over 28 percent of the total bitcoin mining hash rate in the last seven days, according to the market statistics platform Coin Dance.
Bitmain owns what it claims is the “world’s largest” facility for bitcoin mining in Rockdale, Texas. The facility has a capacity of 25MW but can expand to over 300MW in the future. And, its AI division has the potential to generate $14.3 million in yearly revenues, according to Zhan.
Now, it remains to be seen how the conflict between two of Bitmain’s founding members will end. Editor in chief of ChainNews Feng Liu told Financial Times that most shareholders are on Wu’s side and blame Zhan for the struggles the company has faced. Hopefully, the issues will be resolved and the U.S. SEC will not look into this power struggle to decide on whether approving Bitmain’s secretly filed IPO.