Months after it filed an application to go public on the Hong Kong Stock Exchange, Beijing-based cryptocurrency mining giant Bitmain is undergoing a series of business changes that extend even to its China offices, the company confirmed Tuesday.
"There has been some adjustment to our staff this year as we continue to build a long-term, sustainable and scalable business. A part of that is having to really focus on things that are core to that mission and not things that are auxiliary," a company representative said in a statement.
The discussion of the company cutting off staff first emerged on Maimai, China’s equivalent to LinkedIn, where one anonymous user posted a thread on Dec. 17 asking if anyone had insider information about a possible layoff at Bitmain soon.
The post has generated nearly 200 replies since then, some of which came from other users that appear to be verified Bitmain employees on the social network, who indicated the layoffs would start from the week of Dec. 24.
“It’s affirmative. The layoff will start next week and involves more than 50 percent of the entire Bitmain’s headcount,” replied one verified Bitmain staff on Maimai to the thread.
“Some departments have to be let go entirely,” replied another verified Bitmain employee on the same thread.
Currently, some Bitmain employees have already taken to the social network to discuss their respective layoff compensation packages since the week began. An employee from Bitmain's China offices, who is still with the company and who spoke to CoinDesk under the condition of anonymity, confirmed the mining giant is indeed undergoing layoff at the moment.
Since it is still an ongoing process, the source said it’s unclear how many people have been impacted so far and was not able to verify the claim of 50 percent layoff.
“But the whole thing certainly couldn’t be handled in just one day given the total number could be large,” the source said, adding:
The source added this round of operational adjustments has an impact on virtually all business units of Bitmain, including its flagship mining pool product.
“It’s not hard to infer which division is suffering the most. Bitmain’s core business is making miners. Other business lines are just blockchain and artificial intelligence,” the source said, implying the firm is having a major revamp on its push into the blockchain and AI field.
“There’s also some adjustment on the mining equipment business line. For the firm as a whole, it’s going to reduce redundancy to increase operational efficiency,” the source added.
The news makes Bitmain another major industry company that is undergoing reshuffles amid months of cryptocurrency market decline, joining others such as ConsenSys and Steemit. Previously, layoffs were confirmed by Bitmain, but outside of mainland China, where the firm's core operations are based.
However, the source said even without the overall market decline, this round of adjustment was inevitable, due to an extraordinarily fast expansion Bitmain has seen this year.
“Now Bitmain has about 3,100 people, even several hundreds more than what was disclosed in the IPO prospectus in September. But there were only about 1,000 people at the beginning of the year,” the source said, adding the growth rate is like two to three times in general.
“For some specific business lines, the expansion growth rate could be more than three times,” the source added.
Bitmain said also that it is still hiring, despite the layoffs, adding: "As we move into the new year, we will continue to double down on hiring the best talent from a diverse range of backgrounds."
Bitmain CEO Jihan Wu via CoinDesk archives