Bitmain-Backed Crypto Miner Bitfufu Finally Goes Public In SPAC Deal

Bitfufu, a Singapore-based crypto mining platform, is set to start trading on the Nasdaq on Friday after finalizing its long-delayed deal to merge with blank-check company Arisz Acquisition Corp.

Bitfufu had first attempted to go public in January 2022 through a merger with the same special purpose acquisition company formed by U.S. advisory firm MSQ Ventures. The 2022 agreement at the time valuedBitfufu at $1.5 billion, but the deal was postponed repeatedly due to volatility in the crypto markets.

Over the past year, however, the market has bounced back strongly from the scandals that engulfed the crypto sector in 2022, when high-profile players like Sam Bankman-Fried and Changpeng Zhao were found guilty of white-collar crimes and bankruptcies cascaded across the industry.

Bitcoin, the world’s largest cryptocurrency, has recently surpassed $61,000, closing in on its all-time high of almost $69,000. Analysts say bitcoin’s rally is being fueled by the approval of bitcoin exchange-traded funds in the U.S., as well as the upcoming “halving” event that will reduce the supply of new bitcoins.

Upon the completion of the merger on Thursday, Bitfufu received $74 million in private investment in public equity (PIPE) from existing shareholders Bitmain, the Chinese mining rig giant cofounded by crypto pioneer Wu Jihan, and Antpool, an affiliate of Bitmain. Bitfufu said it will use the proceeds to expand its crypto mining offerings.

“Our Nasdaq listing is an essential part of bringing much needed trust and credibility to the industry,” said Leo Lu, founder and CEO of Bitfufu, in a written response. “Tapping global capital markets will provide us with the resources to invest in sales, technology, environmentally friendly operations, and supply chain integration which will allow us to offer even better mining services.”

Bitfufu, whose name is a portmanteau of “bitcoin” and the Chinese meaning of “wealth,”was established in 2020 by Lu, a former Bitmain business director, with an early investment from his former employer. Bitfufu offers cloud mining services, which allow customers to mine bitcoin on its platform without having to buy expensive mining equipment. The startup also mines bitcoin itself. Its other services include sales, rental and housing of bitcoin mining machines.

Bitfufu said its earnings for the first half of 2023 came in at $7.8 million, an 18% jump from the same period a year earlier. And the company’s first-half revenue soared 64% year-on-year to $134 million, with its cloud mining services accounting for more than half of its topline. Bitfufu’s largest customer, according to its earnings report, was ChainUp, a Singapore-based blockchain technology software service provider backed by Singapore property billionaire Kwee Liong Tek.

Bitfufu’s merger with Arisz is one of the few SPAC deals in recent years from the crypto industry that managed to cross the finish line. Another successful merger was that of crypto peer Bitdeer, controlled by Wu, which started trading on the Nasdaq in April last year, although its shares have since dropped nearly 40%.

Crypto companies that had to pull back from public listings include Bullish, a crypto exchange backed by billionaire Peter Thiel and Richard Li, and stablecoin issuer Circle Internet Financial. Both companies had been seeking $9 billion SPAC mergers that were eventually called off in late 2022.

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