Forty-six days, the familiar Wu Jihan and Bitmain are back?

"France, your emperor is back."

On March 1, 1815, Napoleon returned to France with 700 soldiers, sweeping away the shadow of failure.

Facing the French Fifth Army that was suppressing him, Napoleon shouted loudly: "Shoot at me, soldiers, shoot at your emperor."

Inspired by Napoleon, the Fifth Army suddenly turned its back and began to support their new king.

On October 27, 2019, Wu Jihan returned to Bitmain.

Raid, change, dismissal, expulsion. Wu Jihan acted swiftly and decisively, and took control of the situation in a short period of time.

In the eyes of many people, Wu Jihan is the soul of Bitmain. Some people even printed "I LOVE JIHAN" on clothes to express their support for him.

In the forty-six days after the return, Wu Jihan dismissed old people, introduced new policies, and maintained domestic stability while keeping the country safe.

However, facing the counterattack from Zhan Ketuan who may counterattack at any time, the expectations of shareholders, the provocation of competitors and the changes in the industry, Bitmain is facing internal and external troubles.

Can the familiar Bitmain really "come back"?

"Everyone seize the opportunity"

Wearing jeans, a black top and wire glasses, Wu Jihan walked lightly and looked calm.

"Right now, the industry is still in the correction cycle of the bull market." On the stage, Wu Jihan put his right hand in his pocket, held the microphone in his left hand, moistened his lips and spoke freely.

Below the stage, nearly 500 invited guests applauded loudly, held up mobile phones of different models and took pictures continuously.

This was the 2019 Customer Appreciation Party held by Bitmain in Chengdu on December 7. This was Wu Jihan’s first appearance after his “return”.

“Compared to before, Wu Jihan looks a little older, but feels more mature.” Lao Tan (pseudonym), the head of a mining farm in Chengdu, told DeepChain, “The last time I saw him was in 2017.”

In June of that year, the second China Bitcoin Miners Conference was held in Chengdu. At this time, Bitcoin was in an upward phase, quadrupling compared to two months ago. However, this was just the beginning. Since then, Bitcoin has soared to its highest point in history.

The market was booming and the miners were enthusiastic. Bitmain generously provided two nights of accommodation for hundreds of miners attending the conference.

“In the past, you could come by just signing up, but this year’s conference is only available through Bitmain’s invitation, and there are certain conditions.”

Lao Tan told DeepChain that all the guests invited to this meeting were important customers of Bitmain. Taking Lao Tan as an example, the business transactions between him and Bitmain amounted to hundreds of millions of dollars.

As early as half a month before the conference started, Lao Tan received an invitation call from Bitmain officials.

"I was very happy after receiving the call. I think this meeting should bring about a new trend," said Lao Tan.

For a miner, Wu Jihan means a lot to them.

Therefore, when Wu Jihan appeared, the whole venue went into a climax, "some people even cheered."

But unfortunately, because of the happiness and the lively atmosphere, Lao Tan didn't pay any attention to what Wu Jihan said as the first sentence after he came on stage.

However, there is one thing that Lao Tan remembers very clearly, that is, during this conference which lasted about four hours, almost no one left.

“Because of the theme of this conference, all miners are excited: the Bitmain you are familiar with is back.”

At the conference, Wu Jihan introduced three new solutions: installment payment, joint mining, and option hedging, which made the miners excited.

It is reported that as long as a customer purchases more than 100 mining machines at one time, he or she can enjoy a minimum down payment of 50%. If the purchase is more than 5,000 mining machines, only a 20% down payment is required, and the balance only needs to be paid 7 days before shipment.

In addition, Bitmain will also cooperate with miners in mining. Bitmain will provide S17 series mining machines for one year. During the cooperation period, the income will be settled monthly, and the net income will be distributed according to 25% for the partner and 75% for Bitmain.

Finally, Bitmain proposed that any order over 10 million yuan can obtain an option of 1% of the total amount, in order to hedge against the loss caused by the future decline in Bitcoin prices. Interestingly, Bitmain said that the option product will be purchased from Matrixport.

“In fact, Bitmain and Matrixport are also deeply involved in the financial field.” Wu said blockchain told DeepChain, “Mining pools, OTC transactions, lending, options, Bitmain’s ecosystem has everything.”

In Wu Blockchain’s view, through option hedging, Bitmain can fully mobilize its business in the financial field.

Lao Tan recalled to DeepChain that after the customer appreciation meeting, all the participants had a meal together. At that time, he held up a glass of wine and toasted Wu Jihan.

“Will Bitmain focus on both financial and mining machines in the future?” asked Lao Tan.

Wu Jihan did not answer Lao Tan directly, but said calmly: "There is great potential in the future market, so everyone should seize the opportunity."

"Mining machine in the left hand, finance in the right hand"

In July this year, Matrixport, the company founded by Wu Jihan, officially started operation. It is a one-stop platform integrating over-the-counter trading, lending and custody of digital assets.

Matrixport was born in January this year, just as Bitmain was facing a cash crisis. Now Bitmain is bundling its mining machine business with its financial business, which many people think is a wise move.

"This will, on the one hand, stimulate the increase in sales of Bitmain's mining machines, and on the other hand, bring great visibility and more potential customers to Matrixport." A blockchain finance person believes that basically every major buyer of Bitmain's mining machines is a Matrixport customer.

The Bitcoin market is tepid, and the sales of mining machines are unpredictable. Since we cannot open up the source, we must make good use of the existing funds. After all, compared with R&D, production and industry, making money from money may be more efficient.

Currently, Matrixport has expanded into Europe and established a new office in Zurich, Switzerland.

"In the future, Matrixport may be a sharp arrow for Bitmain Group to conquer the market." said the above person.

Bitmain kills two birds with one stone.

Add in installment payment and joint mining. Wu Jihan has three tricks up his sleeve.

But at the same time, some people have questioned the starting point of Bitmain's three-pronged approach. "Bitmain's move is nothing more than a compromise and lowering its profile in exchange for market share." A person close to Bitmain told DeepChain, "If there is another reason, it is to reduce inventory."

“It makes sense to exchange for market share, but it doesn’t make sense to reduce inventory,” Wu told DeepChain.

Since the beginning of this year, the emergence of Whatsminer has seized Bitmain's market share. Although the S17 mining machine is better than Whatsminer's M20 and M21 in terms of performance, it is unable to meet market demand due to the constraints of TSMC's 7NM chip production capacity.

“But Bitmain’s S17 series has not yet reached the point of clearing out inventory, and there are so many S9s left on the market that are still waiting to be replaced.”

However, Lao Tan disagreed with Wu's statement: "For now, S9 is still Bitmain's most popular product. From the official website, both S9 and T17 mining machines are still in stock. If you want to replace S9 with S17, at least you have to sell out S9 first."

Lao Tan also said that he heard that Bitmain would produce 600,000 new mining machines in the second half of the year. He was very interested in it, but would not buy it rashly.

On November 16 this year, some media reported that Bitmain is about to release the next-generation mining machine S19, and that the S19 will adopt TSMC's 7NM technology.

“I heard that S19 is more cost-effective than S17. For miners, the term cost-effectiveness has a familiar feeling.”

"Bitmain used to pay more attention to cost performance." Lao Tan believes that miners are willing to accept a 5% premium for Antminers with the same computing power. This means that miners trust the Bitmain brand.

However, during the period when Jihan Wu was in charge of Bitmain, the price was a bit deviated from the market, resulting in Bitmain's mining machines being "unsellable even if they wanted to sell."

“Miners still recognize the Antminer series of mining machines.” Lao Tan told DeepChain, “I have more than 20,000 mining machines, and more than 60% are Antminers.”

Wu Blockchain agrees with this. He believes that when Bitmain shifts from technology priority to sales priority, the familiar Bitmain is back.

"Defend the country from external harassment and maintain domestic stability"

Jihan Wu is back, and his identity as “Chairman and CEO of Bitmain” is dazzling and eye-catching, which makes people feel amazed and at the same time feel a sense of long-lost.

For a company, there is usually only one absolute leader. When someone comes, someone else has to leave. Without a doubt, Zhan Ketuan is the one who left.

According to reports from various media, Zhan Ketuan was eliminated because he "lost the support of the people" in Bitmain.

According to Tencent News, on October 20 this year, Zhan Ketuan implemented the second annual organizational structure adjustment within Bitmain, which directly caused a large number of old employees who had followed Bitmain for many years to resign, causing great internal anger. Some employees even said that "Zhan Ketuan's head was squeezed by the door" and "Zhan Ketuan went crazy."

Therefore, with the appeal of employees and the support of shareholders, Wu Jihan launched a surprise attack on Zhan Ketuan and fired him on October 29.

It is reported that Wu Jihan was able to succeed in the raid because he received support from people including CFO Liu Luyao, who joined Bitmain from CICC last year and was in charge of Bitmain's IPO-related matters, former Bitmain HRBP Suo Chao, and Ge Yuesheng, who is both a shareholder and the new supervisor.

Since then, Bitmain has never relaxed its "liquidation" of Zhan Ketuan, and Zhan Ketuan has never given up fighting back.

“In fact, the relationship between Wu Jihan and Zhan Ketuan is a bit like that between Steve Jobs and Steve Sculley,” a person close to Bitmain told DeepChain.

In the past, Jobs failed in the struggle with his partner Sculley and was forced to leave Apple and founded NeXT.

After that, Apple went from bad to worse, and finally the Apple board of directors invited Jobs back. After Jobs returned, he immediately replaced the leaders of key positions in Apple with his own people. In the end, Jobs finally achieved control of Apple.

On October 29, Yang Haipo, founder of mining pool operator ViaBTC, also expressed his hope that Wu Jihan would lead the company to glory again like Steve Jobs.

As expected, on the same day that Yang Haipo sent his blessings to Wu Jihan, Wu Jihan dismissed the HR director originally appointed by Zhan Ketuan.

The primary goal of fighting is to identify who is the enemy and who is the friend, to use thundering methods against the enemy and to be gentle and warm to friends.

On the one hand, Bitmain launched a series of attacks on Zhan Ketuan and his team, and on the other hand, it announced that it would make an annual salary increase covering no less than 80% of its employees starting from November 4.

Just take it and release it, everything is under control.

It’s not over yet. Although Wu Jihan has basically taken control of Bitmain, he has not stopped clearing out Zhan Ketuan.

"Milan Zhan has withdrawn from Bitmain as a key member, Milan Zhan has resigned as the legal representative of Suanfeng Technology, and Milan Zhan has been removed from his position at Bitmain's subsidiary Tianjin Diwei Digital Video."

In just one month, Zhan Ketuan seemed to be completely out.

Compared with Wu Jihan's "aggression", Zhan Ketuan's counterattack seems somewhat "pale and powerless".

From the surface, apart from issuing an open letter "declaring war", Zhan Ketuan has no other effective counterattack measures.

On November 8, news came out that Zhan Ketuan pleaded with Wu Jihan, but was ignored; on December 9, there were media reports that at the Bitmain shareholders' meeting, Zhan Ketuan demanded the removal of all the company's directors and the election of himself as the sole director, but this proposal was rejected by many shareholders.

A person close to Bitmain told DeepChain: “It is only theoretically possible for Zhan Ketuan to retake Bitmain.”

"For now, it is possible that Zhan Ketuan will continue to fight against Wu Jihan through legal weapons, but it is not known whether he will succeed." Wu Blockchain said that although Wu Jihan won the victory, he also faced great challenges.

"Can Bitmain really come back?"

Relying on the support of shareholders and clever industrial and commercial changes, Wu Jihan was able to temporarily "win", but as the major shareholder, Zhan Ketuan has always been a sword hanging over Wu Jihan's head.

First of all, shares are a challenge.

To this day, Jihan Wu is still the largest shareholder of Bitmain, holding 36% of the shares, while Jihan Wu only holds 20.25% of the shares. Just like the saying "computing power is justice" in the mining machine world, in the company as a legal entity, equity represents the right to speak.

“Zhan Ketuan has hired lawyers from many places and will not give up,” Wu Blockchain told DeepChain.

Of course, Wu Jihan is under more pressure than just Zhan Ketuan.

During Bitmain’s financing in 2017, investors and management signed a bet agreement to go public within five years. For Bitmain, going public has always been its goal.

On November 21, competitor Canaan Creative was the first to go public and became the world's first blockchain stock. From the outside world's perspective, Wu Jihan and Bitmain must feel some pressure at this time.

"The situation where one mining machine manufacturer monopolizes 80% of the market share is a thing of the past." Zhu Yu, a former Bitmain employee and COO of CoinIn Mining Pool, said at an online event about Canaan Creative's listing.

Earlier in September, the computing power of the Biyin mining pool surpassed BTC.com under Bitmain and ranked first.

In an interview with the media, Zhu Yu said that it has become a fact that the sales volume of Shenma mining machines has exceeded that of Antminer this year.

According to market feedback, Shenma's official website shows that since January, of the 9 mining machines launched by Shenma, 5 have been sold out and the other 4 are out of stock. The cumulative sales have exceeded 2 billion yuan.

In fact, at the employee meeting on October 31, Wu Jihan also personally admitted that the market share of Bitmain's mining machine business was declining.

“The only thing Wu Jihan can do now is to make achievements.” The source told DeepChain, “At least he must regain the lost market share from Shenma Mining Machine.”

Lao Tan also believes that Bitmain has only one real rival, and that is Shenma Mining Machine.

In 2016, due to share distribution issues, Yang Zuoxing left Bitmain and founded Whatsminer, and launched the M series mining machines to become a competitor of Bitmain.

"I am a miner myself. In my mine, I have all kinds of mining machines. In addition to Antminers that account for more than 60%, the second most popular type is Shenma Miner, which accounts for more than 30%."

“Other mining machines such as Avalon and Yibit only account for 2% in total.”

On November 8, the founder of Shenma Mining Machine, Yang Zuoxing, was taken away by the police for investigation, and the industry pointed the finger at Bitmain.

Because of this, Shenma Mining Machine's originally planned M30 mining machine launch conference was forced to be postponed.

According to an insider of Bitmain, ever since Yang Zuoxing launched the Shenma mining machine and it developed rapidly, Zhan Ketuan, who was the actual controller of Bitmain at the time, regarded it as a "major threat". He not only asked major packaging and testing factories not to provide packaging and testing for Shenma, but also continuously filed lawsuits against the Shenma mining machine.

However, what’s interesting is that at 3:46 a.m. on December 7, the day when Bitmain held a customer appreciation meeting, the official WeChat public account of Shenma Mining Machine announced the launch of a new generation of cost-effective and high-computing power mining machine Shenma M30S. According to official propaganda, its comprehensive cost-effectiveness has exceeded that of Ant S17+.

The fight has already begun with both open and covert attacks.

With strong rivals outside and rivals inside, such as Shenma, miners are watching, shareholders are putting pressure on the company, and the industry is not optimistic. Can Wu Jihan, who is under attack from all sides, truly lead the giant ship of Bitmain back?