Bitmain IPO reportedly in “death spiral” as losses increase

To be or not to be – that is the question. In the case of the Bitmain initial public offering (IPO), it’s looking every day that it isn’t to be. A new revelation uncovered by a Twitter user that follows the company almost religiously has shown that the once mighty cryptocurrency mining equipment manufacturer is teetering more toward crashing into the ground in a thunderous explosion.

BTCKING555 tweeted a few days ago that Bitmain’s losses in the third quarter of the year could have been as much as $740 million. If accurate, it would mark the worst quarter in the company’s history, but continues a slide that Bitmain has been experiencing since before the beginning of March.

The tweet reads, “We got leak of Bitmain Q3 numbers! COMPLETE DISASTER. The company lost $740 Million including losses on inventory and bitcoin cash! And this is not accounting for hash war costs!”

BTCKING555 alludes to possible additional losses that could top $1 billion due to Bitmain having a large investment in Bitcoin BCH. Since the digital currency’s value has been cut by more than half its recent value, Bitmain is out a substantial amount of cash.

Bitmain would have no one to blame but itself if it were to fizzle. In preparation of an IPO that was expected to launch this past September, the company falsely claimed to have received backing by a number of international companies. It also ran up substantial debt with a chip supplier – to the tune of $1 billion. It finally paid just over two-thirds of the debt, but there hasn’t been word on whether it has made good on the outstanding portion.

The company has been accused of using customer equipment for its own mining purposes. It faces a class-action lawsuit in California over the allegations, only adding to the uncertain future of its operations.

The company also presented an IPO prospectus with the Hong Kong Stock Exchange that had blatant errors. The ability of Bitmain to completely disregard regulations and present data that has been verified as false should be enough to make any investor skeptical about giving the company any money. Add this to its mounting financial issues are cringe-worthy and should not only make investors say “No, thanks,” but should make them run away screaming.

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Intel cools down crypto mining with new patent

Intel was born by being on the cutting edge of technology, so it’s no surprise that the tech giant would continue to ensure that it is able to be an influencer. The company already has a number of patents related to cryptocurrencies and blockchains, but just added another to its growing binder. The latest could go a long way to countering all of those obtuse individuals who believe that cryptocurrency mining is bad for the environment.

The U.S. Patent & Trademark Office (USPTO) has awarded Intel a patent for a crypto mining processor that allows for “energy-efficient high performance bitcoin mining.” The patent filing specifically refers to the SHA-256 algorithm, which is the most common algorithm used by Bitcoin Core (BTC).

According to the patent, “Dedicated Bitcoin mining ASICs [application-specific integrated circuits] are used to implement multiple SHA-256 engines that may deliver a performance of thousands of hashes per second while consuming power of greater than 200 [watts]. Embodiments of the present disclosure employ micro-architectural optimizations including selective hardwiring certain parameters in Bitcoin mining computation.”

By hardwiring the parameters, the number of computations needed would be reduced. This would allow the mining system to also rely on a decreased amount of power, possibly as much as 15%. The chip could also be made smaller than current chips, which would result in a smaller footprint for the mining equipment that doesn’t have to incorporate a significant amount of cooling devices.

The processor would include additional characteristics that could even further lower the power needs. The patent discusses that, by changing the amount of 32-bit nonce that is used to verify validity, there could be a further reduction in power usage. Intel states in the patent, “Instead of comparing the final hashing result with the target value, [the] bitcoin mining application may determine whether the hash out has a minimum number of leading zeros.”

Intel obviously has a strong history – and a great deal of expertise – with computer processors. In addition to crypto patents the company already holds, it was also the chip manufacturer for 21 Inc., a crypto mining operation. 21 Inc. was later renamed Earn.com and subsequently purchased by Coinbase.

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Squire forms world’s largest publicly-owned crypto mining operation with CoinGeek acquisition

Squire Mining Ltd., a listed issuer on the Canadian Stock Exchange, announced on Friday that is has entered an agreement to acquire crypto mining assets owned by CoinGeek and its affiliates, paving the way for the formation of the largest publicly-owned crypto mining operation in the world—henceforth known as CoinGeek Technologies Ltd.

Under the deal, Squire will take under its wing CoinGeek assets consisting of 62,440 ASIC mining rigs, representing an estimated 960,000 terahash/s or about 90MW of power consumption. These assets are operated by host providers across the United States, with 35,940 rigs, as well as Canada (6,000 rigs), and Kazakhstan (20,500 rigs). The crypto mining assets have an all-in weighted operational cost of US$0.073 per kilowatt hour.

The deal is valued at CAD$60.3 million (US$45.33 million), consisting of 114.8 million Squire common shares worth CAD$34.4 million (US$25.86 million) based on the Nov. 29 closing price of CAD$0.30 (US$0.23) per share. CoinGeek will also receive an unsecured vendor-take-back note worth CAD$25.8 million (US$19.4 million), which it can convert into additional Squire common shares. CoinGeek, for its part, has agreed to enter into a voluntary one-year lock up on the common shares it received.

As part of the agreement, Squire will be taking on CoinGeek’s employees and consultants who are involved with the management and operation of the assets, as well as the CoinGeek.com website and domain, along with all the marketing and advertising assets related to the CoinGeek name.

The Canadian company is also acquiring CoinGeek’s outstanding global distribution agreement for Squire’s ASIC chips and rigs. Earlier this year, Squire granted associates of CoinGeek the exclusive right to market, promote, solicit, sell and distribute Squire’s new ASIC chips and mining rigs to Bitcoin SV and other alt coin miners throughout the world.

Taras Kulyk, chief executive officer at Squire, said: “This transaction would provide Squire with a leading, recognized brand via the acquisition of the CoinGeek.com and CoinGeek name, but it would also make us the largest, publicly traded Bitcoin miner globally. It is expected to deliver significant shareholder value by enabling Squire to become vertically integrated with our growing chip design and manufacturing business, which we would seek to have commercial within 2019.”

“I believe the next phase of growth for this industry is upon us and that means massive scaling of the Bitcoin blockchain to accommodate the throughput needed for enterprises to make use of this technology. By vending my mining and CoinGeek branded assets into Squire, I would be doubling-down on my commitment to Bitcoin’s success. These assets would enable Squire Mining Ltd to compete at a global level to pave a path for enterprise usage of blockchain technology to flourish,” said Calvin Ayre, owner of the CoinGeek brand.

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Botnets increasingly used for crypto mining malware, Kaspersky says

Botnets are being repurposed to distribute crypto mining malware, using victim’s processing power and energy resources to mine for cryptocurrency, according to security experts at Kaspersky Labs.

The findings from cybersecurity company Kaspersky Labs identifies a growing trend towards using botnets in conjunction with crypto mining attacks, which allows hackers the opportunity to commandeer processing power from infected networks.

This processing power is then devoted to mining for cryptocurrencies, including the BTC token, which provides a source of funds for those behind the attacks.

According to the report, botnet owners are increasingly switching towards mining from other attack vectors, highlighting the profitability of this kind of attack. The research suggests that a corresponding drop in DDoS attacks could be as a result of attackers switching focus to mining over other types of malware.

“Evidence suggests that the owners of many well-known botnets have switched their attack vector toward mining. For example, the DDoS activity of the Yoyo botnet dropped dramatically, although there is no data about it being dismantled,” it noted.

The report goes on to say that the malware is often distributed alongside unlicensed, or pirated, software, explaining, “The more freely unlicensed software is distributed, the more miners there are. This is confirmed by our statistics, which indicates that miners most often land on victim computers together with pirated software.”

Kaspersky Labs has previously identified these types of attacks are being attractive for scammers, thanks to the difficulties with detection—both from law enforcement authorities, and from the victims themselves.

Running silently in the background, it is hard for victims to even identify when their system has been compromised, leading to a longer time to detection compared to other types of malware.

There was also the suggestion that some jurisdictions were more amenable to these types of attacks than others, with Kazakhstan, Vietnam and Indonesia amongst the most prominent locations for these types of attacks to originate, according to the report.

The report will serve as a reminder of the dangers of pirated software, and the type of attacks that can infect the computers of those who download software illegally.

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Unauthorized ICO lands crypto mining firm in hot water with Swiss court

Cryptocurrency mining firm Envion AG was reportedly shut down in Switzerland over allegations that it conducted an unauthorized initial coin offering (ICO). On Wednesday, German news outlet Handelsblatt Global reported that the Cantonal court of Zug ordered the company’s liquidation, noting that the Swiss firm lacked any auditing function or board.

Established by Michael Luckow and Matthias Woestmann, Envion is an off-grid mining company that boasts of using decentralized, clean energy such as solar and hydroelectric to power its mobile mining units. The Swiss company held an ICO in early 2018, raising around $100 million.

Luckow accused his partner of taking control of the majority of Envion shares shortly after the company held its crowdsale. Meanwhile, Woestmann claimed Luckow illegally generated another 40 million of Envion’s native tokens (EVN) without the knowledge of the board of directors. This, according to Woestmann, was in addition to the 86 million tokens that were initially agreed on.

In July, the Swiss Financial Market Supervisory Authority (FINMA) launched a probe into Envion’s ICO and found that the company accepted some 100 million francs (worth $100.01 million at the time) from 30,000 investors. The company reportedly gave investors the EVN tokens “in a bond-like form.”

According to reports, FINMA was investigating “possible breaches of banking law resulting from the potentially unauthorized acceptance of public deposits” during the token sale.

Since the dispute between the two, Luckow has been fighting for the firm in a bid to save the original concept. In a Medium post, Envion stated, “The founding team now faces the challenge of responding to fallacious allegations as they make their case against Woestmann. Though Woestmann can produce no evidence supporting his allegations, envion’s founders have begun a campaign to publish the necessary proof to allow investors to determine the truth based on verifiable documentation.”

Financial supervisors have already appointed an investigator to ensure the liquidation process is “unavoidable.”

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Why the future of mining is tied to massive scaling and that means Bitcoin SV

By now, everyone knows Bitcoin SV successfully mined a 64 MB block, the largest ever on a public blockchain. It could mine a substantially bigger one if not distracted by the wasteful Hash war Bitmain and Bitcoin.com forced on the industry because they forked away from Bitcoin to their new ABC coin. This proves that Bitcoin SV scales today as we have promised for a while now.

Why is this important to miners? The reason is the Bitcoin block reward will halve again in just over a year (from 12.5 to 6.25 coins for each block), and then halve again every several years after that. As this happens, if transaction fees do not replace the reduced block reward, Bitcoin mining will not remain profitable. We also want to ensure individual transaction fees remain low so the Bitcoin network can work for an electronic cash system and to support advanced technical features. The only way to increase overall revenue from transaction fees is for the blockchain to massively scale, and to enable huge volumes of low cost microtransactions. This is the only way to drive both Miner revenues and market demand for mining hardware. Therefore, if miners do not support Bitcoin SV and its scaling roadmap, they would be following a path that ends in their own destruction.

Bitcoin SV is the only cryptocurrency with a blockchain that massively scales, the only that has utility value, and the only one that can do it all. BSV will most likely take over and replace all other non-scaling platforms. This will then also grow real utility value in BSV.

But it is important to understand that value in a chain which has no utilitarian use is fake value, and the current dump we are seeing is the market coming to realize that the current alt-coins are all worthless.

I personally look forward to a future where there is only one chain, Bitcoin SV, and this one chain does it all. But it all starts and ends with scaling. Because of this, I believe Bitcoin SV is the only token you can retreat to and have any hope of retaining your value in the current market correction.

Everyone should come to CoinGeek Week this week in London, where thought leaders in this space will be discussing the power of original Bitcoin in Bitcoin SV.

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The Genesis mining team makes a desperate plea to miners

Genesis Mining, the cloud-based cryptocurrency mining service, is hoping a marketing gimmick will help it attract new subscribers. After running a Halloween special that offered as much as 25% in discounts on new package subscriptions, the company is at it again, hoping to capitalize on Black Friday and Cyber Monday. It has taken the campaign to a new level, however, and is offering a 25% discount on all contracts.

According to a notice that was send to current subscribers, Genesis wrote, “It is Cyber Monday and our Black Friday Week special is on the home straight. You have until midnight (CET) today to take advantage of our best Black Friday deal ever – a 25% discount on all our Hashpower including our NEW $50 TH/s 2-year Bitcoin mining contracts. So don’t hesitate any longer – go ahead and make your purchase! All you need to do is use the Promo Code ‘BlackFriday25’ during the purchase checkout process.”

Genesis has apparently needed to receive major cash injections to stay afloat. It recently emerged from a six-month cease-and-desist order in South Carolina and soon after announced changes to its subscription service in an effort to overcome a difficult year. It indicated that certain users would be obligated to upgrade to a five-year plan or face having their contracts suspended. In making its announcement, it gave the indication that it has not been able to produce the revenue that it had anticipated all year.

It has been a challenging year for many in the crypto industry, but some have weathered the storm better than others. 2019 is going to bring even more changes to the space and will be the year that truly identifies cryptocurrency’s potential. It’s for this reason that those blockchains that are not ready to scale will suffer greatly. The market slide has caused the waters to recede, exposing the vulnerabilities and models of those cryptocurrencies that do not provide any real utility.

Bitcoin SV is poised to be the one blockchain that can embrace the future and the growth explosion that is going to come. Those networks that are not prepared for scalability on a large level are going to be left behind and will ultimately find themselves in a position that forces them into dissolution.

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Cryptojacking malware hits Make-A-Wish Foundation site

Cybercriminals are at it again, this time setting their sights on a charity foundation.

Last week, researchers at security firm Trustwave reported that they have found a CoinImp crypto mining script has been injected into the official website of Make-A-Wish Foundation. In a blog post, the Trustwave researchers said the malware has been mining cryptocurrencies since May 2018. CoinImp has been using the website visitors’ computing power to mine cryptocurrencies.

Upon further investigation, researchers discovered that the foundation’s website became vulnerable earlier this year when its domain host, Drupal, became vulnerable to CVE-2018-7600, a remote code execution bug popularly known as “Drupalgeddon 2.” Drupal, an open source content management system, claimed that the vulnerability allowed hackers to inject malicious malware into specific websites that had failed to add in their security patch.

The CoinImp miner is based on the JavaScript and is generally used by individuals who secretly want to mine Monero currency using visitor’s phone, tablet or computer.

This particular cryptojacking incident was difficult to find because it used different techniques to avoid detection, according to Trustwave’s Simon Kenin. First, the malware changes the domain name that hosts the JavaScript miner. In addition, the WebSocket proxy also used different domains and IPs to avoid blacklist solutions.

Researchers have warned that Drupal-based websites need to be updated to avoid attacks from these and other malicious malware. Just this spring, the Drupalgeddon 2 bug, Remote Code Execution (RCE) vulnerability in the older versions of Drupal, affected more than 100,000 sites.

Meanwhile, McAfee Labs, an Internet security provider warned the public to watch out for a new cryptojacking malware called WebCobra. The company stated that unlike previous malware, the new cryptojacking malware could not be traced in the victim’s computer. The malware will slow down the user computer and consume a lot of power during its operations.

 

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Are you ready for CoinGeek Week Conference?

If you haven’t already purchased your tickets to the hottest cryptocurrency conference of the fall, time is almost up. The CoinGeek Week conference is happening this week in London, featuring an all-star cast of crypto and blockchain experts to guide the community into 2019 and beyond.

The conference is one of the most important events for everyone in the crypto space. However, Miner’s Day will undoubtedly be the highlight. The special, invitation-only event was added to the conference in order to give crypto miners the perfect opportunity to learn about the changes seen recently in Bitcoin BCH and to understand what is going on with Bitcoin SV and the future of mining operations.

Miner’s Day will be held tomorrow, November 27. Following it will be three more exciting days of events, information sharing, seminars and workshops that will deliver an experience unlike any other crypto conference. CoinGeek Week is being held at The Mermaid at Puddle Dock in London, an amazing venue that will provide an incredible backdrop for this one-of-a-kind event.

November 28 of the conference is geared specifically for application developers. It will give attendees the opportunity to learn everything they need to know about what is going on with the latest in blockchain technology. November 29 is for application merchants and will provide significant insight on how to get the edge on the competition. Following each day’s activities, there will be a casual meet-and-greet event where attendees can network and forge new business alliances.

The last day of the conference is dedicated to the future—where blockchains and Bitcoin BCH are headed. This is an excellent way to pool together all of the information presented throughout the conference and attendees will walk away knowing that they have an important role in shaping cryptocurrency’s future. Following the activity, those who have attended all four days are invited to a special after party hosted by CoinGeek founder Calvin Ayre, bringing to a close this incredible conference.

Tickets are on sale now, but there are only a few tickets remaining. You can purchase yours today using either Bitcoin BCH on the CoinGeek website or, if you prefer, with a credit card through Eventbrite. Don’t be stuck on the sidelines watching history being made—get in the game and help make it happen.

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Bitmain has a choice – pay up or else

Bitmain is in serious trouble. It may have been able to portray confidence, solvency and reputability, but the masks are finally starting to come off. In addition to having to answer for a number of financial irregularities ahead of its planned initial public offering (IPO), the cryptocurrency mining equipment manufacturer has already been targeted for allegedly stealing the design of a miner. Earlier this month, word got out that it is in major debt to the Taiwan Semiconductor Manufacturing Company (TSMC) and it looks like things are about to get ugly.

The truth always surfaces. It may not happen immediately, but it always will. Bitmain has been facing a number of issues since the beginning of 2018, while it maintained a smile on its face to the public the entire time. If a recent Twitter post is any indication, however, the company that once ruled the crypto mining space is literally on the verge of going bust.

According to a tweet by “BTCKING555” from yesterday, “Breaking: Our insider says Jihan is furious at BCH-SV for costing him massive in hash war. With Illiquid BCH collapsing, Jihan is running out of cash and has to pay TSMC. TSMC CFO issued ultimatum, pay or we cut you off for good! Bitmain [may be] bankrupt by year end?”

It has been reported that the majority of the assets held by Bitmain are in equipment that sits in warehouses, unable to be sold. It reportedly ran up a tab of around $1 billion with TSMC – an astounding amount of debt for a company to carry if it’s the world’s leading manufacturer of anything. After TSMC went on the offensive, Bitmain reportedly paid back $700 million and is still on the hook for the remaining $300 million.

Bitcoin BCH has plummeted in price since the hard fork. It has been previously reported that a large portion of the money Bitmain’s co-founder, Jihan Wu, had available was in the form of BCH. Now, with a drop of over 75% in value, this means that his holdings are worth over 75% less than he would like.

Whether or not the company is able to pay off its debt or go bankrupt remains to be seen. However, one thing is certain – it is nowhere near as stable as it has tried to make everyone believe.

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