Swan Bitcoin Drops IPO Plan, Cuts Staff and Will Shut Managed Mining Unit

Bitcoin financial services firm Swan Bitcoin has withdrawn plans to take the company public, shut down its managed mining unit and reduced staff across several units.

Swan CEO Cory Klippsten said in a social media post that the company will still offer bitcoin {{BTC}} financial services and free bitcoin education. “With no significant near-term revenue expectations from our Managed Mining business, we are withdrawing our plans to go public in the near future,” Klippsten wrote in the X post.

“Accordingly, Swan is pulling back from our accelerated spending plan for our core financial services business. Unfortunately, this includes staff cuts across many functions,” he added.

ANNOUNCEMENT – @Swan It is unlikely that we will continue our Managed Mining business in the near term. Without significant near-term revenue expectations from our Managed Mining business, we are withdrawing our plans to go public in the near future.

Accordingly, Swan is retreating…

— Cory Klippsten 🦢 #Bitcoin is for everyone (@coryklippsten) July 22, 2024

The move comes at a time when the mining landscape has become more competitive following the recent Bitcoin halving, which cut block rewards in half. The availability of spot Bitcoin exchange-traded funds (ETFs) has also deterred many investors from the mining industry and closed some of the doors to capital for miners. As a result, many miners are struggling to keep their businesses profitable by running pure-play mining operations and shifting some of their infrastructure to serve AI and cloud computing-related services.

While the Bitcoin halving has made the mining ecosystem more difficult and less profitable, several private miners are still racing to go public after Bitcoin hit a record high earlier this year. Other firms reportedly planning IPOs include Genesis Digital Assets, formerly backed by FTX’s Sam Bankman-Fried, and two units of Northern Data.

Swan announced earlier this year that it would go public within the next 12 months and that its mining unit has a processing power of 160 megawatts (MW), or 4.5 exahashes per second (EH/s).

At the time, the company said its mining business had been funded by institutional investors for more than $100 million and that it hoped to raise more capital to expand its operations. Tether was among the backers of Swan’s managed mining service and invested an undisclosed amount in the business.

The story continues

Read more: Bitcoin Halving Poised to Unleash Darwinism in Miners

UPDATE (July 22, 18:29 UTC): Added additional context about Swan’s $100 million funding and investors in the final paragraph.