The Upcoming BCH Fork and Its Implications for Bitmain
On November 15th, Bitcoin Cash (BCH) will undergo another hard fork, presenting a critical challenge for Bitmain. According to Bitmain's IPO prospectus, the company currently holds $886.9 million in cryptocurrencies, including 1.02 million BCH tokens—making this fork pivotal for Bitmain’s future.
The Diverging Visions Behind the Fork
- Bitcoin ABC (supported by Bitmain) announced upgrades aiming to transform BCH into an infrastructure-focused public chain, expanding its use cases beyond transactions.
- nChain (led by Craig Steven Wright) advocates for the Bitcoin Satoshi Vision (BSV), insisting BCH should adhere strictly to Satoshi Nakamoto’s original vision of peer-to-peer cash.
With major exchanges like Binance and Coinbase confirming the fork, the split appears inevitable. Public clashes between Bitmain’s Jihan Wu and Wright have further intensified tensions.
Bitmain’s Preparations
Reports suggest Bitmain’s Antpool has urgently deployed 90,000 S9 miners in Xinjiang ahead of the fork—a move interpreted as fortifying its hash rate dominance. Meanwhile, Wright’s proclamation, “This war won’t end until I win or we all lose,” underscores the high-stakes battle.
Bitmain’s Historical Resilience and Current Vulnerabilities
Founded in 2013, Bitmain survived near-bankruptcy during the 2014 Bitcoin bear market. By 2017, it dominated 70–80% of the ASIC miner market, peaking with $2.9 billion in assets. However, the 2018 crypto winter has eroded Bitcoin’s value by two-thirds, exposing Bitmain to unanticipated risks.
Key Challenges Facing Bitmain
1. Over-Reliance on Miner Sales & R&D Delays
- Dependency: 97% of Q1 2018 revenue ($19B) came from miner sales, 67% from 2016’s S9 model.
- Innovation Lag: Competitors like Canaan Creative and GMO Internet launched 7nm miners ahead of Bitmain’s S15/T15 release, signaling eroded technological leadership.
2. IPO Struggles and Negative Publicity
- Funding Rumors: SoftBank, Tencent, and others denied involvement in Bitmain’s Pre-IPO round.
- Internal Strife: Alleged disagreements between co-founders Jihan Wu (pro-crypto) and Micree Zhan (pro-AI) over strategic direction.
- Legal Battles: Coingeek’s claim of unpaid $300M TSMC bills was dismissed by Bitmain as “baseless.”
Conclusion: Survival in a High-Stakes Industry
Bitmain’s trials mirror the broader crypto sector’s volatility: relentless competition, regulatory ambiguity, and existential uncertainty. As mining firms race to go public amid the bear market, securing capital isn’t just growth—it’s survival.
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FAQ Section
Q: How does the BCH fork impact Bitmain’s holdings?
A: Bitmain owns 1.02M BCH—worth ~$886M. A contentious fork could devalue its reserves.
Q: What’s Bitcoin ABC’s upgrade goal?
A: To evolve BCH into a smart-contract-enabled chain, diverging from pure payment utility.
Q: Is Bitmain still the ASIC market leader?
A: Yes, but rivals like Canaan now rival its tech with 7nm chips, threatening its dominance.
Q: Why is Bitmain’s IPO critical?
A: Public listing could provide liquidity to endure the crypto winter’s prolonged downturn.
Q: What’s Craig Wright’s endgame with BSV?
A: To revert BCH to its original Bitcoin whitepaper principles, rejecting ABC’s expansions.