Two Chinese bitcoin mining equipment makers plan $1 billion Hong Kong listings

Asian Stock Markets

Two Chinese bitcoin mining equipment makers plan to raise up to $1 billion each from Hong Kong listings this year, riding on strong global interest in cryptocurrencies, IFR reported on Tuesday, citing people familiar with the plans.

Canaan Creative filed a listing application to the Stock Exchange of Hong Kong on Monday, IFR, a Thomson Reuters publication, reported.

Zhejiang Ebang Communication has also started working with advisers on a proposed Hong Kong float of up to $1 billon, reported IFR.

Ebang listed on China’s National Equities Exchange and Quotations, also known as the New Third Board, in 2015 and was

delisted from the over-the-counter market in March after announcing in January that it would seek a Hong Kong listing.

Chinese bitcoin mining equipment makers are hungry for capital to fund their growth as the heightened interest in cryptocurrencies has led to a surge in demand for their machines.

Canaan, which sells “Avalon” mining machines with customised super-fast ASIC chips, made revenue of more than 1 billion yuan in 2017. Although cryptocurrencies can be mined using regular computer equipment, specialised processing devices dedicated to mining are more effective and can generate more income.

The company’s co-chairman Jianping Kong told Reuters in April that he expected China’s push to promote the domestic chip industry to help drive growth for the company.

Credit Suisse, CMB International, Deutsche Bank and Morgan Stanley are joint sponsors for Canaan’s float, according to IFR.

Canaan Creative declined to comment. Ebang could not be immediately reached for comment. All the banks didn’t immediately respond to a request for comment.

Canaan’s IPO valuation has yet to be set as there is no listed comparable and the prices of cryptocurrencies have

fluctuated a lot, reported IFR. It was valued at $500 million in mid-2017, IFR said, attributing it to one of the people.

Bitcoin Price Watch: Wait and Watch

Global Stock Markets

So we are finally approaching the end of this week and we’ve had a really odd week as far as volatility in the bitcoin price is concerned.

 Things are really unpredictable and we’ve not been able to judge where things are going to go within a couple of hours, never mind a day or more, which has translated to some pretty tough trading.

Not that we mind tough trading – our strategy is designed to take advantage of it, in fact – but it just makes things a little more awkward and necessitates that we stay on top of our risk management a little more, rather than keep things loose.

Anyway, enough of that.

Let’s get some levels in place that we can employ for the session going forward and see if we can pull a profit from the albeit volatile market.

As ever, take a quick look at the chart below before we get started so as to get an idea where things stand. It’s a one-minute candlestick chart and it’s got out primary range overlaid in green.

The range we are looking at for the session today comes in as defined by support to the downside at 10386 and resistance to the upside at 10562.

We are going to focus primarily on our breakout strategy for the time being, purely because this range is a little tighter than normal and we don’t want to risk getting into an intrarange entry only to subsequently miss out on a breakout signal.

So, with that said, we’re going to look at getting in long towards an upside target of 10670 if we see price close above resistance. A stop on the trade at 10530 looks good from a risk management perspective.

Looking short, a close below support will signal a downside entry towards 10250.

Let’s see how things play out.

SEC says bitcoin funds raise 'investor protection issues'

The U.S. securities regulator on Thursday raised alarm about the safety of bitcoin-themed investments, telling the fund industry they want answers to their concerns before endorsing more than a dozen proposed products based on cryptocurrencies.

A top division chief at the U.S. Securities and Exchange Commission detailed the agency’s concerns about the wild-trading investment in a letter to two trade groups representing fund managers who unleashed a range of proposals for funds holding bitcoin or related assets.

The SEC’s division of investment management demanded answers to at least 31 detailed questions about how mutual funds or exchange-traded funds based on bitcoin would store, safeguard, and price that asset.

They also asked whether investors can understand the risks and how to address concerns that bitcoin markets could be manipulated.

“It shows that they’re going to have to take some time to consider the industry’s responses before they change their minds on it,” said Senderowicz, a partner at Dechert LLP. 

Bitcoin slumps below $10,000, half its peak, as regulatory fears intensify

Bitcoin skidded below $10,000 on Wednesday, halving in value from its peak price, with investors gripped by fears regulators could clamp down on the volatile cryptocurrency that sky-rocketed last year.

The price of bitcoin, the world’s biggest and best known cryptocurrency, fell to as low as $9,500 on the Luxembourg-based Bitstamp exchange, the lowest since Dec. 1.

Bitcoin had touched a peak of almost $20,000 in December - and indeed crossed over that threshold on some exchanges - but has since been roiled by several large selloffs.

Other cryptocurrencies plunged as well. Ethereum and Ripple were both down heavily after reports South Korea and China could ban cryptocurrency trading, sparking worries of a wider regulatory crackdown.