What information does Zhan Ketuan’s mysterious counterattack article reveal?

On the evening of May 1, in the face of Bitmain’s statement and media accusations, former Bitmain chairman Zhan Ketuan rarely spoke out. An unsigned article circulated online, revealing a lot of previously unknown information. Several insiders said that from the tone to the content, it was very likely that Zhan said it himself.

Article link: "Bitmain's coup is suspected, Wu Jihan can't sit still anymore?"

Excluding some emotional accusations, the article reveals several interesting details:

1: The article revealed that the key reason why Wu Jihan successfully changed the legal person was that the Haidian District Market Supervision and Administration Bureau changed the regulations to simplify the business environment. It no longer required the signatures of the new and old legal persons at the same time, and only one of them was needed to take effect. Therefore, Wu Jihan did not need Zhan's signature and could directly change the legal person in Beijing through the decision of Hong Kong.

(This is a bit awkward. Doesn't it mean that the procedure of the Haidian District Market Supervision Administration changing the legal person itself is fine and in line with legal principles? Then why did the Haidian Justice Bureau deny this decision? This article does not explain the inside story.)

2: The article revealed that the trigger for Wu Jihan's sudden dismissal might be that Zhan Ketuan had looked for a new CFO candidate for Bitmain in October 2019 and was preparing to make an offer.

(In fact, after Zhan Ketuan took power at the end of 2018, he had been gradually replacing the people in charge of Wu Jihan's management areas. At that time, he should have "invaded" the other party's last base and was preparing to replace the CFO, the person in charge of the mining pool, etc.)

3: The article states that Wu Jihan cancelled the 10-fold voting rights of Class B shares by amending the articles of association of Bitmain Cayman. Wu Jihan amended the company's articles of association without convening a shareholders' meeting.

(It is impossible to amend the articles of association without holding a shareholders' meeting. So there is only one answer: Zhan Ketuan did not attend the shareholders' meeting. So from his personal perspective, he believes that "no effective shareholders' meeting was held.")

4: The article played the "good guy card", saying that from the composition of the board of directors, it can be seen that Zhan Ketuan completely trusted Wu Jihan. It can even be said that Zhan Ketuan was in a completely defenseless state at the time.

(The logic here is a bit confusing. If you have full trust, why would you change the CFO?)

5: The article points out that the layoffs also made many people realize that Wu Jihan is not someone who can run Bitmain well.

(This sentence sounds very much like James’ tone. In 2019, James was defeated by his old rival Yang Zuoxing, while Wu Jihan made 300 million US dollars in the first four months of this year. Needless to say, there is a huge gap between the two in terms of business operations.)

6: The article reveals two choices for Zhan Ketuan:

First, continue to go through the court process to restore his 10 times voting rights. People familiar with the matter revealed that Wu Jihan will definitely lose this lawsuit because no effective shareholders' meeting was held, which is a very certain fact.

Second, first take back the dominant position according to the current one-share-one-vote rule. Zhan Ketuan has 36% of the shares, and he only needs to win over a portion of the middle shareholders (15%) to complete 51% control and regain the company's decision-making power.

(The article then plagiarized the equity distribution map produced by Wu Shuo Blockchain without indicating the source. I hope this insider will pay the copyright fee.)

But the confident insiders seem to have forgotten that the second strategy has already failed. In early December last year, Zhan Ketuan organized a shareholders' meeting under the guidance of a lawyer to try to remove the existing directors, but failed because the shareholding ratio could not reach 50%. This also indirectly shows that the middle shareholders support Wu instead of Zhan.

In the end, there is only one: Cayman.

A careful look at Bitmain's Articles of Association reveals that: when amending the Articles of Association, Class A and Class B shareholders can only cast one vote, without 10 times the voting rights; and only attendees can vote; amending the Articles of Association requires 75% of the attendees. Zhan's attitude is that "no effective shareholders' meeting was held." Whether this shareholders' meeting is valid or not will ultimately depend on how Cayman judges it.

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