Bitmain made headlines recently after their planned initial public offering (IPO) on the Hong Kong Stock Exchange failed and now it seems that this development could have some serious legal ramifications for the mining giants.
According to reports, a regular Bitmain Twitter critic, BTCKING555 has claimed a group of investors is putting together a class-action lawsuit against Bitmain. The suit is to be submitted in Hong Kong and looks to recover investments that were made in view of the pending IPO.
BTCKING555 aired his grievances towards Bitmain and their founder, Jihan Wu on Twitter. In an expletive ridden rant, the account said:
“… [T]here are now tons of pissed of Asian investors that were duped by Jihan to invest during summer at $12 – $14 [billion] with a promise of IPO at minimum $18 [billion]. Now many understand this is mirage and Jihan deceived them on numbers and outlook. His reputation is shit!”
The rant did not stop there, he also added:
“… [A]lready in august I warned many investors and prevented them from investing. Those that did not listen, good luck recovering your moneys. I hear there is class action in works in Hong Kong.”
According to BTCKING555, Bitmain was given $700 million last summer which helped the company from going under. The revelation of the IPO saw the company receive a financing deal that increased Bitmain’s value to around $15 billion, but the failure of the company to move forward with the IPO completely negates any previous valuation.
The news around the apparent lawsuit has soured what has been quite a good period for Bitmain. They recently announced a new CEO, Haichao Wang, and are also in the midst of putting together plans for a huge investment into mining in China, worth around $80 million.
