bitcoin group a new digital miner may list on the asx 2297892015
After two unsuccessful attempts, will third time prove lucky?
The Bitcoin Group, a “miner” that creates digital currency bitcoin through energy-intensive, high-tech computing operations, may list on the ASX on November 11.
This will be the company’s third attempt at an ASX listing. The Australian Securities and Investments Commission (ASIC) suspended the issue on two previous occasions, with the latest stop order being issued for promoting the float on Chinese social media before the company’s prospectus was approved. The company has been trying to list its shares since October 2014.
"As the world's first IPO in our industry, we are no doubt setting a precedent," said chief executive Sam Lee earlier this month with reference to the ASIC’s actions. "ASIC's role to protect Australian investors means they need to understand our unique business model. We appreciate the patience ASIC have shown to understand what we do, and thank their co-operation in helping ensure our prospectus accurately reflects the current and future opportunity of Bitcoin Group."
The company is seeking to raise AU$20 million to fund operations development at its mining sites in China, Iceland and Australia. A small amount from the proceeds, about 10 per cent, will be used to repay AU$230,000 in loans advanced to the company by founders and directors Samuel Lee, Ryan Xu and Allan Guo.
Bitcoin Group intends to issue 100 million new shares at AU$0.20 per share. On completion of the offer, the company’s market capitalisation is expected to be approximately AU$33 million.
The company grossed nearly AU$1.73 million in 2014-15 by mining digital bitcoins, earning a profit of AU$10,000. During 2015-16, expects to clock revenues in the range AU$21.3 million to AU$63.7 million, according to the Australian Financial Review. The range is a function of bitcoin’s volatility, which can fluctuate heavily when its value is expressed in another currency. For the latest prospectus, the crypto-currency has been valued in the range AU$250 to AU$550 per coin.
According to the prospectus, key risk factors include the heavy reliance on the China-sited operations, which produce nearly 99 per cent of the company’s revenue, as well as uncertain acceptance of the digital currency by governments and central banks around the globe.
If successful, Bitcoin Group will follow in the footsteps of Digital CC Ltd (ASX:DCC) – the first digital currency to list on the ASX. Digital CC closed Friday at AU$0.160, up 6.67 per cent.
