Swan Bitcoin, the popular Bitcoin-only financial services company decided not to go public this year, shutting down its managed mining unit and reducing staff in various departments. The company announced the bad news earlier this week.
Hard decisions
Swan’s CEO, Cory Klippsten,shared on social media that the company will continue to offer Bitcoin financial services and free Bitcoin education, but he explained that without significant revenue from the Managed Mining unit in the near future, they have decided to cancel their IPO plans.
ANNOUNCEMENT – @Swan is unlikely to continue with our Managed Mining business in the near term. Without the expectation of significant near-term revenue from our Managed Mining unit, we are pulling our plans to IPO in the near future.
Accordingly, Swan is pulling back from our…
— Cory Klippsten 🦢 #Bitcoin is for everyone (@coryklippsten) July 22, 2024
This decision also includes cutting back on spending for their core financial services business, resulting in staff reductions across multiple areas.
The ’24 Bitcoin halving, which reduced block rewards by half, to 3.125, made the mining industry much more competitive.
This, combined with the availability of spot Bitcoin ETFs deterred many investors from the mining sector, making it harder for miners to stay profitable.
As a result, some miners are pivoting their infrastructure to serve artificial intelligence and cloud computing services, and some have to shutting down the mining.
Mining is a digital race
Despite the harsher environment post-halving, some private miners are still wanting to go public, driven by Bitcoin’s new ATH earlier this year, for example, Genesis Digital Assets and units of Northern Data are reportedly also planning IPOs.
Swan Bitcoin had earlier announced plans to go public within 12 months and mentioned that its mining unit had huge computing power, with 160 megawatts or 4.5 exahash per second up and running.
Expansion plans
The mining unit was funded by institutional investors, securing over $100 million with hopes to raise more capital for expansion.
Tether was among the investors, although the exact amount of its investment wasn’t disclosed.
This funding’s goal was to supporting Swan’s managed mining service and its growth plans in the longer term.
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