Brevan Howard, Galaxy, Weiss back Canaan’s $72M Bitcoin mining raise

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The mining hardware maker said it's refocusing on its core business of ASIC chip design and high-performance computing equipment as it scales production in the United States.

Brevan Howard, Galaxy, Weiss back Canaan’s $72M Bitcoin mining raise

Bitcoin mining hardware maker Canaan Inc. has secured a $72 million strategic equity investment from Galaxy Digital, Weiss Asset Management and Brevan Howard’s digital asset arm, Brevan Howard Digital.

The transaction, announced on Tuesday, will bolster the company’s balance sheet and reduce its dependence on future at-the-market (ATM) capital raises, it said. Under the deal, investors bought 63.7 million American depositary shares, representing Canaan’s Class A stock at $1.13 each through a registered direct offering.

Founded in 2013, Canaan specializes in application-specific integrated circuit (ASIC) chip design and high-performance computing equipment. The company developed the first Avalon-branded Bitcoin mining rigs in 2013 and listed on Nasdaq in 2019.

According to Canaan, the investment marks a change in its capital markets approach, reflecting a move to collaborate with fundamentals-focused investment companies.

At the time of writing, Canaan’s stock price was up about 9% in intraday trading on Nasdaq, according to Yahoo Finance.

Canaan doubles down on core business

While many Bitcoin mining companies have diversified into artificial intelligence and high-performance computing (HPC) to boost revenue, Canaan has reinforced its focus on Bitcoin mining hardware and infrastructure.

In June, the company said it would discontinue efforts to produce AI hardware. Canaan Chairman and CEO Nangeng Zhang told Cointelegraph the most strategic path forward for the company is to double down on its “core strengths in crypto infrastructure and Bitcoin mining.”

Canaan also said in June it completed a pilot production run in the United States as part of its efforts to reduce delivery times to customers in the region. The company’s stock rose over 26% in October after it announced a 50,000-rig order by an unnamed US company, its largest order in over three years.

The US accounts for nearly 38% of the global Bitcoin hashrate, with six of the 10 largest publicly listed Bitcoin mining companies headquartered in the country.