Former Canaan Directors to Guide Chinese Gaming Firm's Pivot to Crypto Mining

U.S.-listed Chinese gaming company The9 (NASDAQ: NCTY) has announced plans to enter the cryptocurrency mining space.

• In an SEC filing, The9 said it had signed a legally binding “cooperation and investment” agreement with investors including two former directors of cryptocurrency miner maker Canaan (NASDAQ: CAN).
• The company said it is working with the investors – led by Jianping Kong, former director and co-chairman of Canaan – to launch its new cryptocurrency mining operation via a wholly owned subsidiary called NBTC.
• The9 is an internet and mobile gaming firm based in Shanghai.
• “Our goal is to build up cryptocurrencies mining machines for The9 that will contribute 8% to 10% of the global hash rate of bitcoin, 10% of the global hash rate of ethereum and 10% of the global hash rate of Grin and become one of the world’s largest cryptocurrencies mining companies in terms of hash rate,” said Jun Zhu, chairman and CEO of The9.
• The investment agreement will see the issuance of issue Class A ordinary shares and warrants bringing the right to purchase more shares in four tranches. The firm expects to raise around $34 million if all the warrants are exercised.
• Following the announcement, The9’s shares spiked 87% to $6.62 per share.

Read more: Beyond ASICs: 3 Trends Driving Bitcoin Mining Innovation

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