Chinese mining giant Canaan doubles profits despite the blanket crypto ban

Main Chinese language cryptocurrency miner producer Canaan seems to don’t have any points with the native ban on crypto, as the corporate’s total efficiency has continued to develop in 2022.

Canaan formally announced its monetary outcomes for the second quarter of 2022 on Thursday, reporting a 117% improve in gross revenue from the identical interval of 2021. In response to the agency, the Q2 income amounted to 930 million renminbi (RMB), or practically $139 million.

The corporate’s Q2 web revenue was 608 million RMB, or $91 million, or a 149% improve from 425 million RMB in the identical interval final yr. Canaan famous that international forex translation adjustment in Q2 was an revenue in comparison with earlier losses as a result of U.S. greenback appreciation in opposition to RMB throughout Q2.

Regardless of posting vital income, Canaan has discovered the second quarter a difficult interval because of Bitcoin (BTC) plummeting beneath $20,000 in June, the corporate’s CEO, Nangeng Zhang, stated.

“The COVID-19 containment lockdown in key cities in China additionally introduced extreme disruptions to our each day operations and demand for our AI chips,” he famous.

Zhang talked about that Canaan has been increasing its world presence, significantly establishing worldwide headquarters in Singapore. The agency has additionally been working to scale its mining enterprise, producing extra BTC with an improved energy provide. As of late June, Canaan held a complete of 346.84 BTC, or $8.1 million, the CEO stated, including:

“We’re absolutely conscious of the downward strain from the Bitcoin value because the final fourth quarter and count on it to carry extended headwinds to our efficiency within the coming quarters. Nonetheless, we consider within the distinctive worth of Bitcoin and its long-term prospects.”

Canaan’ chief monetary officer James Jin Cheng echoed the CEO’s remarks, stating that the corporate expects a harder market atmosphere from the decrease Bitcoin value stage in addition to elevated vitality value and numerous pandemic and geopolitical uncertainties. He acknowledged:

“Because the Bitcoin value additional decreased within the second quarter, we responsively lowered our product value for spot gross sales to shoulder the strain with our purchasers. […] We count on the gross margin to lower dramatically within the second half of this yr.”

The continued cryptocurrency winter will not be the one concern of crypto mining corporations in China although. As beforehand reported, China introduced a blanket ban on all crypto operations — together with mining and buying and selling — in September 2021, pushing many corporations to power world growth and escape to different nations. Previous to the ban, China was taking down a number of crypto mining farms in a transfer to save lots of vitality and curb crypto operations within the nation.

Associated: Bitcoin mining income jumps 68.6% from the lowest-earning day of 2022

Apparently, the “nice Chinese language crypto ban” has not affected native crypto fanatics and corporations an excessive amount of as far as China reemerged because the second-largest Bitcoin mining nation by January 2022. In response to information from the Cambridge Bitcoin Electrical energy Consumption Index, China nonetheless hosts 21% of the whole world Bitcoin hash fee, following solely the USA, which produces 38%.

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