Bitdeer (NASDAQ: BTDR) Secures Leading ASIC Market Position With All-Stock FreeChain Acquisition
Benzinga
By Gerelyn Terzo, Benzinga While the capital markets are currently facing constraints, mergers and acquisitions are alive and well in the Bitcoin mining industry. Most recently, Bitdeer Technologies (NASDAQ: BTDR) announced its blockbuster acquisition of crypto Application-Specific Integrated Circuit (ASIC) design company Desiweminer, also known as FreeChain, in a $140 million all-stock transaction. Since the deal was revealed, Bitdeer’s stock price has rallied, rising from $7.01 on June 5th to its current price of over $11. Investors can think of FreeChain as the Nvidia (NASDAQ: NVDA) of the blockchain space, as it builds the chips that other companies use in Bitcoin-mining activities. According to forecasts, demand for ASIC Bitcoin mining chips is poised to hit $25.7 billion in the next eight years, and Bitdeer, with revenue of $368.6 million in 2023, seems poised to capture more market share. The stock deal involved the exchange of FreeChain’s issued and outstanding shares for 20 million newly issued Bitdeer’s Class A ordinary shares. Among the conditions included in the agreement are that half of the Bitdeer shares issued to sellers can’t be transferred for six months from deal closing, while the balance of the shares must be held for 12 months. The combination of Bitdeer and FreeChain has been in the works for the better part of a year, as the Singapore-based Bitcoin miner vetted the target company, including its technology, engineering staff and supply chain strategy for months. As part of the deal, FreeChain’s workforce will be integrated into Bitdeer’s in Singapore, with plans to introduce newly integrated products immediately. As Bitdeer explained, the business combination is designed to further consolidate its position in the technology industry while accelerating its ASIC research and development capabilities. Bitcoin miners are rewarded in new bitcoins for securing the Bitcoin blockchain, which involves completing complex mathematical transactions using computing power. It’s a fiercely competitive field in which the equipment a miner uses, including a mix of a hash rate and computing power, makes or breaks their profitability. Bitdeer’s acquisition of FreeChain catapults it to a more competitive position in the ASIC-chip race, which is dominated by a few select industry players. In response to recent developments, Wall Street firm H.C. Wainwright maintained its buy rating on Bitdeer stock alongside a bullish $20 price target on the stock. Bitdeer Chief Business Officer Linghui Kong welcomed the deal, which is subject to closing conditions. He touted FreeChain’s accomplishments, not least the presence of 30,000 of its high-performance machines currently used in the market, positioning the company among the leading ASIC design groups on the planet. “Desiweminer’s remarkable achievements in ASIC design and their proven track record, with nearly 30,000 high-performance machines in the market, make them one of the top ASIC design groups in the world,” said Kong. Bitdeer And FreeChain Have Complementary Businesses Both Bitdeer and FreeChain are dedicated to Bitcoin mining, providing the infrastructure that miners need to continue securing the Bitcoin blockchain in an energy-efficient, low-cost and profitable way. FreeChain is behind cutting-edge ASIC chip technology design, fitting well with Bitdeer’s groundbreaking ambitions. In particular, FreeChain’s ASIC chip design supports advanced semiconductor processes at 4nm and below, which paves the way for Bitdeer to deliver its next generation of super-efficient Bitcoin mining chips in 2025. This is important because the industry standard is currently 5nm chips, which have been around for several years, while Bitdeer has successfully tested its 4nm Bitcoin mining chips, called Seal01. In addition to processing power, both companies are also focused on energy efficiency, delivering the most environmentally friendly ASIC chips possible for the energy-intensive process of Bitcoin mining. With a market cap of about $1.5 billion, Bitdeer is among the industry’s leading Bitcoin mining companies. Founder and CEO Jihan Wu was the maiden translator of Satoshi Nakamoto’s Bitcoin whitepaper into Mandarin and was a first-mover for ASIC technology in the Bitcoin mining industry. Investors who are looking to participate in the next wave of Bitcoin mining and ASIC technology might want to consider Bitdeer sooner or later, as the company is only just getting started. Featured photo by u_8t3emw1yia on Pixabay. Benzinga is a leading financial media and data provider, known for delivering accurate, timely, and actionable financial information to empower investors and traders. This post contains sponsored content. This content is for informational purposes only and is not intended to be investing advice. Contact Details Benzinga +1 877-440-9464 info@benzinga.com Company Website http://www.benzinga.com
July 05, 2024 08:30 AM Eastern Daylight Time
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