Lawsuit Shows How a Public Firm’s $80M Bet on Bitcoin Miners Went Terribly Wrong

In March 2018, shortly after bitcoin’s bull run to $20,000, a publicly-traded Chinese company invested 500 million yuan, worth $80 million at the time, to buy 100,000 bitcoin mining units. 

As the bear market kicked in during the months that followed, so, too, did a contract dispute, offering a rare window into Chinese public firms tapping into bitcoin mining as a new business stream and reflecting the prolonged magnitude of last year’s market sell-off.

The $80 million mining investment made by Beijing Cailiang, an app developer fully-owned by Shenzhen-listed Wholeasy, brought home almost negligible profit return in 2018. Yet it dragged the company into a lawsuit involving $15 million in debt and a potential criminal case with accusation of fraudulent public disclosure.

Though the amount at dispute may seem insignificant, the case sheds light on the increasing investments by institutions in China into an area where even public entities typically shy away from public discussions….