Report: Chinese Publicly Traded Construction Company Turned Mining Firm Sold After Value Falls 90%
Hautie HengAn, the publicly traded Chinese construction firm turned crypto mining company, has reportedly been sold. This news comes via a report by local English-speaking crypto-centric media 8btc earlier today.
According to the report, the company has been sold for about 12 million Chinese yuan ($1.8 million USD), after its value decreased more than 90%, from 170 million yuan ($25.3 million USD) in less than a year. Huatie HengAn began as a subsidiary of its parent company, Huatie, and maintains that its main business is providing cloud computing services.
However, as the report notes, according to the company’s filings, it seems that Huatie HengAn’s primary business is cryptocurrency mining — in 2018, the company purchased 36,500 machines from Avalon and Ebang. Moreover, it seems Huatie HengAn attempted to obfuscate the fact that it had purchased the miners. In its filings, they refer to the machines as “servers,” when in reality, Avalon and Ebang do not manufacture traditional computer servers, but instead cryptocurrency mining gear.
8btc states that the sale of Huatie HengAn attracted significant attention from the local crypto community, as it may be China’s first publicly traded company that has been found to engage in cryptocurrency mining, although they did try to hide it. (This comes as the Chinese government is weighing the possibility of eliminating cryptocurrency mining from the country.) Unfortunately, the company’s move did not work out — the depreciation of the mining arm of its business totalled 95 million yuan ($14 million USD) on an initial investment of about $25 million USD.
Per the report, the company’s total revenue last was 53 million yuan ($7.9 million USD), but as of February 28th of this year, the firm’s net losses climbed to almost 158 million yuan ($23.5 million USD). Altogether, this resulted in a depreciation of the company to a value of 12 million yuan (1.8 million USD).
Neither the buyer nor the full terms of the sale were revealed in the report.