Months after filing a request for quotation on the Hong Kong stock exchange, the Beijing cryptocurrency mining giant, Bitmain, is undergoing a series of corporate changes that also extend to China's offices, confirmed Tuesday.
"There have been some adjustments for our staff this year as we continue to build a long-term, sustainable and scalable business, part of this is having to really focus on the things that are critical to that mission and not on those that they are auxiliary, "a company representative said in a statement.
The discussion of the company that cut the staff emerged for the first time on Maimai, The Chinese equivalent of LinkedIn, where an anonymous user posted a discussion on December 17 asking if anyone had early privileged information on a possible layoff at Bitmain.
The post has generated nearly 200 replies since then, some of which came from other users who appear to have been verified by Bitmain employees on the social network, which indicated that layoffs would start from the week of December 24th.
"Yes, the firing will start next week and will involve more than 50% of the entire staff of Bitmain," replied a Bitmain staff verified on Maimai to the thread.
"Some departments must be left completely," replied another Bitmain employee verified on the same thread.
Currently some Bitmain employees have already started to visit the social network to discuss their compensation packages for layoffs from the start of the week. An employee of the offices of Bitmain in China, who is still in the company and who spoke with CoinDesk on condition of anonymity, confirmed that the mining giant is currently undergoing a layoff.
Since it is still an ongoing process, the source said it is not clear how many people have been affected so far and has not been able to verify the 50% redundancy request.
"But certainly it was not possible to manage everything in one day, since the total number could be great," said the source, adding:
"This is an operational adjustment, some projects will be completely eliminated, so it is difficult to calculate a precise percentage at this stage."
The source added that this round of operational adjustments has an impact on virtually all Bitmain business units, including its flagship mining product.
"It is not difficult to deduce which division is the most suffering: Bitmain's core business is mining, and other lines of business are just blockchain and artificial intelligence," the source said, implying that the company is having an important renewal in its push towards the blockchain and the artificial intelligence field.
"There is also some adjustment on the mining equipment business line, and for the company as a whole, it will reduce redundancy to increase operational efficiency," the source added.
The news makes Bitmain another important company in the sector that is undergoing a reshuffle after months of decline in the cryptocurrency market, joining others like ConsenSys and Steemit. Previously, layoffs were confirmed by Bitmain, but outside mainland China, where the company's core businesses are based.
However, the source said even without the general market downturn, this round of adjustments was inevitable, owing to an extraordinarily rapid expansion that Bitmain has seen this year.
"Now Bitmain has about 3,100 people, even several hundred more than disclosed in the September IPO prospectus, but at the beginning of the year there were only about 1,000 people," he said the source, adding that the growth rate is two or three times in general.
"For some specific business lines, the growth rate of expansion could be more than three times," added the source.
Bitmain also said that he is still hiring, despite the redundancies, adding: "As we move into the new year, we will continue to double the hiring of the best talent from a wide range of backgrounds".
CEO of Bitmain Jihan Wu through the CoinDesk archives