Former Chinese ‘big three’ crypto exchange BTCC has agreed to sell 49 percent of its mining pool, BTCC Pool Limited, in equity in a non-legally binding agreement.
In an announcement [PDF] published on the Hong Kong Stock Exchange, prospective buyer Value Convergence Holdings Limited – a Hong Kong-based asset management and financial services company – outlined details of its proposed acquisition of 4,900 shares for a 49% equity stake in BTCC Pool.
The deal is currently in a non-legally binding memorandum of understanding that, if finalized, will see Value Convergence (VC) raise HK$147,000,000 ($18.73 million) to complete the proposed acquisition.
A notable detail from the MoU reveals a clause wherein the audited net profit of BTCC Pool, after taxation for the financial year ending in June 2019, should see a guaranteed minimum of HK$30,000,000 ($3.82 million).
Through its subsidiaries, VC operates a securities brokerage and other businesses in corporate finance in regions including greater China. The publicly-listed firm intends to mark its foray into the cryptocurrency sector by purchasing the 49% equity stake in the bitcoin mining pool through Initial Honor Limited, its wholly owned subsidiary.
Data over a four-day period from Blockchain.info shows BTCC Pool amount to 1.1 percent of bitcoin’s hashrate, now dominated by mining pools owned by Chinese crypto mining giant Bitmain.
BTC China-turned BTCC, the world’s oldest bitcoin exchange, was forced to close its operations in China after sweeping curbs in 2017 effectively shuttered the initial coin offering (ICO) and cryptocurrency sector domestically.
Earlier this year, BTCC revealed it too had been acquired by a Hong Kong-based investment fund. BTCC co-founder and CEO Bobby Lee revealed the finances would help BTCC shift its focus to the international market at the time. Last month, BTCC announced plans to launch an upgraded exchange platform with support for cryptocurrencies including bitcoin, ethereum, litecoin and bitcoin cash.
Featured image from Shutterstock.
Last modified: May 20, 2020 8:39 PM UTC