Chinese Openly Listed Construction Company Turned Mining Firm Lost Over $23 Million

A listed Chinese building company turned to a cryptocurrency mining company, Huatie HengAn, allegedly sold after its value dropped by more than 90 percent. The development was reported on 19th April 8btc, crypto-target local media in English.

The company would be sold for about 12 million yuan ($ 1.8 million) after its value fell to 170 million yuan ($ 25.3 million) in less than a year. According to the report, Huatie HengAn began as a subsidiary of the parent company Huatie and claimed to be primarily engaged in providing cloud computing services.

Nevertheless, 8btc notes that, according to financial reports, the company's main business is exploiting the cryptocurrencies, since in 2018 it bought 36,500 machines in Avalon and Ebang. Although the report invokes machine servers, manufacturers are well known for producing integrated circuits that are specific to exploiting cryptocurrencies and do not produce servers in the traditional sense of the term.

8btc says the company's sales attracted a lot of attention from the local cryptographic community since it could be the first public company in the country that deals with mining cryptography. The loss of the parent company due to mining operations would amount to more than 95 million yuan ($ 14 million).

This value would have exceeded the initial investment of approximately $ 25 million. Also, 8btc notes that the company's revenue for the year amounted to 53 million yuan ($ 7.9 million) and that on 28 February net loss amounted to nearly $ 158 million. yuan (about $ 23.5 million). Anything would reduce the company's net assets to only 12 million yuan ($ 1.8 million).

The tweet posted on April 12 by the research group of the major BitMEX platform for the Cryptocurrency Performance estimates that Bitcoin SV Miners (BSV) accumulated a gross $ 2.2 million loss.

As Cointelegraph has recently reported, the Chinese government agency is considering abolishing cryptographic mining in the country. Also, at the beginning of the current month, Hong Kong's Financial Services Secretary and Treasury said mining cryptography operations were governed by local commercial law, and the criminal offense was punishable by a fine or a prison sentence.


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