On July 7, 2020, the power struggle between the two co-founders of Bitmain, Micree Zhan, and Jihan Wu, reached new heights after Zhan appeared to be re-routing the company’s payments credentials to entities fully controlled by him.
According to an announcement posted on Bitmain’s Weibo account, allegedly controlled by Zhan, customers were notified that the mining giant’s bank account and email have changed.
This prompted Dovey Wan, founding partner at PrimitiveCrypto, to tweet that the move “marks Jihan’s death in the Bitmain power struggle” while adding that Zhan also controlled the changed official corporate website.
However, Wu quickly issued a statement claiming that these actions are due to compromised WeChat and Weibo accounts that are reporting false info. He further denied making any changes, including altering the Bitmain bank account or web domain.
Bitmain, a leading BTC mining hardware manufacturer, has been witnessing an ugly tussle between Zhan and Wu. The feud started when the then-executive director, Zhan was ousted in a power struggle last year.
“Bitmain staff must no longer take any instructions from Ketuan Zhan or participate in any meeting organized by Zhan,” Wu warned.
Zhan then proceeded to file a lawsuit in December of 2019, asking a court to void a decision supposedly passed at a shareholder meeting that considerably reduced his voting power.
Is Zhan Winning?
Zhan seems to have landed several heavy blows to Wu’s authority at the company, which began to steal the company’s official seal in May of this year.
He then used private guards to storm Bitmain’s Beijing office and take over the legal representative’s role. However, Wu managed to reserve control of important company entities, especially Bitmain’s Hong Kong-based office.
It remains unclear who is currently in control of Bitmain, as it appears that the company’s legal structure prevents either party from decisively ousting the other.
On June 24, Zhan offered Wu the chance to purchase his and other investors’ stakes worth $4 billion, which could signal the opening of talks for a truce between the co-founders.
More Troubles at Bitmain Paradise
It’s not clear what started the rift between the two entrepreneurs, who created Bitmain in 2013 and benefited from the ensuing crypto-mining boom in 2017.
Since they started quarreling, their company has gone through a failed IPO, followed by accusations from miners that Bitmain released a batch of Antminer products with an unusually high failure rate.
That said, the mining farms controlled by the company are doing well, with the total BTC hashrate controlled by Bitmain under its affiliates, adding up to about 30% of the total Bitcoin hashrate.