Bitmain: The Rise, Struggles, and Evolution of a Crypto Mining Giant

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Bitmain Technologies Ltd., commonly known as Bitmain, is a Beijing-based semiconductor company that has played a pivotal role in shaping the global cryptocurrency mining landscape. Founded in 2013 by Wu Jihan and Zhan Ketuan, the company quickly rose to dominance through its innovative ASIC (Application-Specific Integrated Circuit) chips and ANTMINER mining hardware. Over the years, Bitmain has not only led the crypto mining hardware market but also ventured into artificial intelligence (AI) chip development, cloud mining services, and strategic philanthropy.

Despite its early success, Bitmain has faced significant challenges—including internal leadership conflicts, regulatory crackdowns, and geopolitical tensions—shaping its evolution into a more diversified yet complex tech enterprise.

Founding and Early Innovations

Bitmain was co-founded in 2013 by Wu Jihan, a former financial analyst and blockchain advocate, and Zhan Ketuan, an entrepreneur with a background in IP solutions. Recognizing the growing demand for efficient cryptocurrency mining, the duo focused on designing high-performance ASIC chips tailored for Bitcoin and other proof-of-work cryptocurrencies.

Their first major product, the ANTMINER S1, launched in 2013, delivered a hashing rate of 180 GH/s and set a new standard in mining efficiency. This was quickly followed by the ANTMINER S2, which surpassed 1 TH/s, cementing Bitmain’s reputation for rapid innovation.

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The company's early success stemmed from vertical integration: designing chips, building miners, operating mining pools like ANTPOOL and BTC.com, and even running large-scale mining farms across China. By 2018, Bitmain controlled a dominant share of the global Bitcoin mining hardware market and operated some of the largest mining pools worldwide.

Market Dominance and Financial Milestones

By 2018, Bitmain had become the world’s largest designer of ASIC chips for cryptocurrency mining. That year, it reported a net profit of $742.7 million** in the first half alone, with annual revenue estimated at around **$2.5 billion in 2017. Its profitability rivaled established tech giants, drawing comparisons to companies like NVIDIA during the GPU boom.

The company attracted major investments, including a $50 million funding round in 2017 from top-tier firms such as Sequoia Capital and IDG Capital, aimed at accelerating its AI chip development.

Bitmain also gained recognition on global business lists:

These milestones reflected both its technological leadership and investor confidence in its dual focus on blockchain infrastructure and AI computing.

Expansion into AI and Strategic Diversification

While crypto mining remained core to its business, Bitmain began investing heavily in artificial intelligence chips starting in 2017. The goal was to leverage its expertise in low-power, high-efficiency chip design for AI applications such as machine learning inference, edge computing, and smart surveillance systems.

This strategic pivot positioned Bitmain as a competitor to companies like NVIDIA and Google in the AI accelerator space. However, progress was hampered by internal turmoil and shifting market dynamics.

Internal Conflict and Corporate Split

One of the most defining chapters in Bitmain’s history was the founder feud between Wu Jihan and Zhan Ketuan.

In late 2019, Wu removed Zhan from all executive positions and took control of the company’s operations—a move that sparked legal battles over corporate control, including disputes over business licenses and office access. The conflict paralyzed decision-making and delayed critical initiatives, including Bitmain’s planned IPO in Hong Kong.

After months of litigation and negotiations, the two parties reached a settlement in early 2021:

This division significantly impacted Bitmain’s valuation, which dropped from an estimated RMB 80 billion to around RMB 30 billion, while competitors like MicroBT gained ground in the mining hardware market.

Regulatory Challenges and Market Adaptation

In June 2021, China launched a sweeping crackdown on cryptocurrency mining and trading activities. In response, Bitmain paused sales of mining equipment on its global spot market to reduce inventory pressure amid falling demand.

Although this move signaled a retreat from direct consumer sales during turbulent times, it also demonstrated the company’s agility in adapting to regulatory shifts. Bitmain shifted focus toward institutional clients and long-term contracts while maintaining its R&D pipeline.

Philanthropy and Academic Partnerships

Despite operational challenges, Bitmain maintained a strong commitment to corporate social responsibility:

These contributions highlight Bitmain’s long-term vision of supporting technological advancement beyond immediate commercial interests.

Subsidiary Scrutiny: The Sophgo (SOPHON) Case

A key part of Bitmain’s AI strategy involved its subsidiary Sophgo Technology (算能科技), which developed AI chips under the SOPHON brand. However, in January 2025, Sophgo was added to the U.S. Department of Commerce’s Entity List for allegedly violating export controls by facilitating the transfer of advanced TSMC-made chips to mainland China.

This designation restricts U.S. companies from doing business with Sophgo without government approval and raises concerns about supply chain integrity. Reports suggest that Sophgo-designed chips were found inside Huawei’s Ascend 910B AI module—an allegation that led TSMC to suspend shipments.

While Sophgo denies any direct or indirect ties to Huawei, the incident underscores the growing geopolitical risks facing Chinese semiconductor firms operating in sensitive technology sectors.

FAQ: Understanding Bitmain’s Impact

Q: What does Bitmain do?
A: Bitmain designs ASIC chips and manufactures mining hardware (ANTMINER series) for cryptocurrencies like Bitcoin and Bitcoin Cash. It also operates mining pools (ANTPOOL, BTC.com), offers cloud mining via Hashnest, and develops AI chips through its subsidiary Sophgo.

Q: Who owns Bitmain now?
A: Following the 2021 settlement, Zhan Ketuan regained control of Bitmain’s core operations in China. Wu Jihan stepped down and now leads Bitdeer Technologies, a separate entity focused on cloud mining services.

Q: Is Bitmain still profitable?
A: While exact figures are private post-IPO withdrawal, industry estimates place Bitmain’s revenue valuation between $8–9 billion in 2021. Its continued product releases (e.g., S19 series) indicate sustained market presence and profitability.

Q: Why did Bitmain stop selling miners globally?
A: In mid-2021, Bitmain temporarily halted spot sales due to China’s crypto mining ban and resulting market uncertainty. The pause helped manage inventory and stabilize pricing amid volatile conditions.

Q: Are Bitmain miners still competitive?
A: Yes. The ANTMINER S19 series remains among the most efficient Bitcoin miners available, offering high hash rates with improved power efficiency thanks to 7nm chip technology.

Q: What is the future of Bitmain?
A: Despite past setbacks, Bitmain continues innovating in both blockchain infrastructure and AI computing. Its long-term success will depend on navigating regulatory environments, advancing chip technology, and competing with emerging players in the global semiconductor space.

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Conclusion

From its rise as a crypto mining powerhouse to navigating internal strife and geopolitical headwinds, Bitmain’s journey reflects the broader evolution of blockchain technology—from speculative frontier to institutional-grade infrastructure. While no longer the undisputed leader it once was, Bitmain remains a key player in shaping the future of decentralized networks and specialized computing.

As the lines between blockchain, AI, and semiconductor innovation continue to blur, companies like Bitmain stand at the intersection of technological progress and global policy challenges—positioned to influence how digital value is created, secured, and scaled in the decades ahead.

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