Bitcoin Group, Australia’s largest mining company, has pushed back its Initial Public Offering again. It will postpone the date of the company enlistment on the ASX until the middle of January because of the requirement to issue the third prospectus. Unfortunately the company faces obstacles on the way towards its aim not for the first time.
Initially Bitcoin Group came across several stops from the Australian Securities and Investment Commission (ASIC) after it had raised most of the $3.6 million needed for the IPO. The first one took place soon after the receipt of the first prospectus.
ASIC withheld the listing date for the second time when it emerged that the group was promoting the fundraising round on a Chinese social media platform WeChat before the prospectus was approved and lodged.
In the end of November Bitcoin Group had to issue the third prospectus as ASIC required to hire an independent expert to prepare a detailed report on the bitcoin mining and the bitcoin mining equation process.
ASIC insisted on providing a report to ensure that investors were aware of the possible threats behind the digital currency. It wanted to get information on “how the Bitcoin industry operates, the variables underpinning the Bitcoin Mining Equation… and its impact on BCG, and information setting out future performance of BCG…”
As a result of multiple delays Bitcoin Group has announced that investors who have already applied for the company’s shares will be able to withdraw and get a full refund.
If the process of enlistment to the ASX goes successfully, the market value of Bitcoin Group will reach $33 million which will make it the second largest bitcoin company listed on the ASX. The first place goes to DigitalBTC that joined the ASX in 2014.
Bitcoin Group was founded in Melbourne in 2014 as a result of five-year partnership between CEO Samuel Lee and co-founders Allen Guo and Ryan Xu. When the deal is finally complete, ASX shareholders will own more than half the company, 60.6%. The three executive directors will share the rest of 8.6%.
Bitcoin Group now operates seven facilities across Australia, China and Iceland. The startup produces around 1.57% of the global mining output through its seven mining sites and in the period 2014-15, it mined around $2 million worth of the digital currency.
Most of the company’s revenue, 98.5%, is produced through Chinese operations. The prospectus lists this as one of the key risks at the enterprise together with volatile bitcoin price and cautious attitude to a relatively new industry.