The mining equipment manufacturer Canaan secured $50 million through the issuance and sale of convertible preferred shares.
According to a report to the SEC, the firm reached an agreement with an unnamed institutional investor in November 2023. The funding was received in two equal tranches in December and January.
“The company intends to use the proceeds from the sale of securities for research and development, production scale expansion, and other general corporate purposes,” Canaan stated.
In September 2023, the company introduced a next-generation bitcoin miner with immersion cooling, the A1466I. This device was Canaan’s first to achieve an energy efficiency of less than 20 J/TH, bringing the firm closer to market leaders Bitmain and MicroBT in this regard.
In 2021, Canaan began its own cryptocurrency mining operations by launching a facility in Kazakhstan, following the opening of its first service center outside China in the country.
Subsequently, the company expanded its mining business to the United States.
In August 2023, Canaan temporarily halted mining operations in Kazakhstan following the implementation of mandatory licensing requirements. The company clarified that this affected equipment with a hash rate of 2 EH/s, approximately half of the total capacity.
In mid-November, Canaan obtained a license to conduct cryptocurrency mining activities in the Central Asian country.
In its financial report for the third quarter, the firm reported a 79.5% decline in mining revenue compared to the previous period, down to $3.3 million. Equipment sales in terms of capacity reached 3.8 EH/s, increasing by 38.7% over the quarter.
With total revenue at $33.3 million, Canaan’s net loss for the period amounted to $80.1 million.
Following the disclosure of the secured funding, the company’s stock price rose by 10% from the opening price to $1.6.
In November 2019, Canaan became the first mining equipment manufacturer to go public. During its IPO on Nasdaq, the company raised $90 million by issuing 10 million depositary receipts at $9 each.
As reported by CoinShares experts, following the upcoming halving, only Bitfarms, Iris, CleanSpark, TeraWulf, and Cormint among public miners are expected to operate profitably.