BTC Mining Giant Canaan Spent $10 Million To Buy Shares At Low Price

The BTC mining giant Canaan from China, spent $10 million from the previous 2019 IPO in the US, to purchase shares while the price is at a historical low so let’s read more in today’s bitcoin news.

The BTC mining giant Canaan is spending $10 million to buy back shares which cost about $2. The Chinese company reported a year-over-year decline in net revenue of 26% in the second quarter. Last November, the company which makes computer chips and hardware for bitcoin mining rigs, had its shares priced at $9 on the Nasdaq stock exchange as a part of the $90 million Initial public offerings.

With the price below $2 and almost hitting an all-time low, the company will spend up to $10 million to get its shares back. According to the press release from the company, we can read:

 “The number of [American Depositary Shares] repurchased and the timing of repurchases will depend on a number of factors, including, but not limited to, price, trading volume and general market conditions, along with Canaan’s working capital requirements and general business conditions.”

Canaan’s unaudited second-quarter financial results were released last week and shed light on the hardware’s market thinking. It reported a year-over-year decrease n computing power sold and the net revenues of 18.2% and 26.3% respectively. The CEO of Canaan at that time, Nangang Zhang blamed the decline in revenue on the COVID-19 pandemic and Bitcoin’s price volatility which was associated with the Bitcoin halving back in May when the block rewards for mining were cut in half.

The COVID-19 outbreak that started in China was already trending downward by February before the pandemic in the US and the rest of the world spiked. This helps explain why Canaan’s earnings through June seem fine. The quarter over quarter net revenue was up by 160% to $25.2 million. The CFO Quanfu Hong said:

 “Looking ahead, we will continue to invest in those areas that can strengthen our product offerings, streamline our operations, and solidify our market leadership. I’m Confident in the underlying strength of our fundamentals and optimistic about the long-term growth prospects of our business.”

It this is true, with the share price flying over the low levels and the Chinese industry emerging from the pandemic, this could be the time for Canaan to reinvest and buy back its shares.