The infighting of the founders of Bitmain ended: Wu Jihan left, the company was split, and the valuation plummeted

Bitmain’s “infighting” drama that has lasted for more than a year has finally come to an end.

On January 26, 2021, Jihan Wu, the co-founder of Bitmain, announced his official resignation as CEO and chairman of Bitmain through an encrypted letter. Jihan Wu said:

As the co-founder of Bitmain, I have enjoyed the 2815 day journey and received selfless help and support from many clients, colleagues, friends and investors.

  The infighting of the founders of Bitmain ended: Wu Jihan left, the company was split, and the valuation plummeted

Wu Jihan also said that he would send his most sincere wishes to Ketuan Zhan and Bitmain led by him.

The gentleness of the wording and blessings in the letter is in sharp contrast with the infighting between Wu Jihan and Ketuan Zhan in the past infighting, which is shocking.


The “Power Seizing” Battle Between Wu Jihan and Zhan Ketuan

Ketuan Zhan never imagined that, as the major shareholder and chairman of Bitmain, Wu Jihan, the co-founder of Bitmain, would suddenly seize power.

October 27, 2019, was the day before the Shenzhen Security Expo was officially held. On this day, Bitmain held a conference of the third-generation smart server SA5 in Shenzhen. At that time, Ketuan Zhan appeared at the conference as the chairman of Bitmain.

On October 28, business information showed that Ketuan Zhan, chairman of Bitmain, stepped down as the legal representative of Bitmain, and was replaced by Wu Jihan, co-founder of Bitmain, and Ketuan Zhan no longer served as executive director. Ketuan Zhan was completely unaware of the major personnel changes registered in the industrial and commercial sector.

On October 29, Wu Jihan suddenly attacked.

On the same day, Wu Jihan, as the founder of Bitmain, chairman of the board of directors of Bitmain, legal representative & executive director of Beijing Bitmain Co., Ltd., issued an internal notice, announcing that Ketuan Zhan was relieved of all positions in Bitmain, effective immediately; The notice also requires Bitmain employees to no longer execute Ketuan Zhan’s orders and not participate in meetings convened by Ketuan Zhan.

The infighting of the founders of Bitmain ended: Wu Jihan left, the company was split, and the valuation plummeted

A rift between the control of the two founders of Bitmain was made public.

You know, Jihan Wu and Ketuan Zhan are both key figures in Bitmain, and they are both founders of Bitmain. In terms of equity, Bitmain adopts an AB share structure. Each A-share common share has one vote, and each B-share common share has ten votes—except for the two co-founders of the company, Ketuan Zhan and Jihan Wu. Except for B shares, all company management and investors hold A shares.

According to the prospectus previously published by Bitmain, Ketuan Zhan and Jihan Wu hold about 3.989 billion B shares and 2.243 billion B shares respectively, and their shareholding accounts for 56.25% of the issued share capital before listing. Regardless of their shareholding ratio or voting rights, Zhan and Wu’s absolute control over Bitmain is unshakable.

But between Wu Jihan and Ketuan Zhan, Ketuan Zhan has a greater equity advantage and is the largest shareholder of Bitmain.

On November 7, 2019, after being “expelled” by Wu Jihan, Ketuan Zhan posted a long response on Weibo, saying:

It is embarrassing. As the founder and largest shareholder of Bitmain, I never knew that the legal representative registered with the government department would be suddenly changed without my knowledge. When the big change came, I realized that there have been countless scenes in film and television dramas, and the scenes of being stabbed in the back by my once most trusted partner and the “brother” who fought together will really happen.

Ketuan Zhan also said that all attempts to harm and take advantage of Bitmain will fail.


From being “expelled” to being deprived of a business license

After being “expelled”, Ketuan Zhan has never stopped paying attention to this company even though he is outside Bitmain.

At the end of 2019, Bitmain launched a personnel optimization plan; it is reported that the AI ​​business led by Ketuan Zhan has become the focus of optimization due to insufficient profitability; on January 4, 2020, Bitmain announced in an internal letter that the appointment of AI computing Wang Jun, the new CEO of the Feng business line.

In response, Ketuan Zhan issued an open letter on January 6 expressing his opposition to layoffs and calling for suicide.

The infighting of the founders of Bitmain ended: Wu Jihan left, the company was split, and the valuation plummeted

Of course, at this time, if Ketuan Zhan only appealed on Weibo, he would not actually be able to control Bitmain’s operations – but he never gave up the fight for control of Bitmain.

In fact, after being “expelled”, Ketuan Zhan filed an administrative lawsuit with the Haidian Court because he was dissatisfied with the industrial and commercial registration change decision made by the Haidian District Market Supervision Administration, and then withdrew the lawsuit and changed it to administrative reconsideration – January 31, 2020, Haidian District, Beijing made an administrative reconsideration decision to revoke the registration of changing the legal person to Wu Jihan on October 28, 2019.

However, on January 2, 2020, Bitmain’s legal representative changed again, from Jihan Wu to General Manager Liu Luyao – Liu Luyao is Wu Jihan’s high school and undergraduate classmate.

Therefore, Ketuan Zhan once again filed an administrative reconsideration with the Haidian District Judicial Bureau on February 12, 2020, applying to revoke the change of legal representative and restore himself as the legal representative; on April 28, 2020, Beijing Haidian District again issued a reconsideration decision book, and revoke Liu Luyao’s legal representative status.

That is to say, in three or four months, the legal representative of Bitmain has changed twice: from Ketuan Zhan to Wu Jihan, and from Jihan Wu to Liu Luyao – but under the obstruction of Ketuan Zhan, this was changed. Both changes have been revoked by the administrative department.

It seems that Zhan Ketuan is the winner.

However, on May 8, 2020, at around 11:00 a.m., at the window 52 on the second floor of the Government Affairs Service Center in Haidian District, Beijing, the business license of Beijing Bitmain Technology Co., Ltd. was snatched from the hands of industrial and commercial administrative staff by a group of unidentified men. Let’s go, the legal person of this business license is Ketuan Zhan.

It is understood that there are more than 60 unidentified big men in the group, and Liu Luyao is the on-site commander.

At three o’clock in the afternoon, Bitmain issued another statement:

The public registration of the market supervision department shows that Ketuan Zhan is the legal representative of our country, which is a registration error, and seriously violates the provisions of the “Company Law”… Ketuan Zhan pretends to be the legal representative of “Beijing Bit”. …


Two founders reconcile, Bitmain is seeking IPO

The incident of “grabbing a business license” at the Haidian District Government Service Center in Beijing forced Wu Jihan’s party to face accountability from the public security department and the procuratorate. :

The police detained some of the leaders. Liu Luyao “cooperated with the investigation” and was released a few days later. Someone was detained for 37 days on suspicion of “picking quarrels and provoking trouble.”

But for Ketuan Zhan, the recapture of the company has to go on.

It is understood that in June 2020, Ketuan Zhan obtained the business license and returned to the company by picking the lock from the back door, but was still obstructed by Wu Jihan in the internal operation.

On July 17, 2020, Wu Jihan released the “Book to All Colleagues”, saying that the reason why Ketuan Zhan was relieved was that Ketuan Zhan had swelled after his success and could not listen to his opinions – he also said that the original intention of the company to change the management was only In order to survive the crisis, survive and develop, without any intention of revenge.

However, by the end of July 2020, according to the “Latepost” report, Ketuan Zhan and Jihan Wu were already negotiating; specifically, Ketuan Zhan tried to acquire the options in the hands of shareholders and employees at a valuation of US$4 billion.

In September 2020, Beijing Bitmain continued to undergo industrial and commercial changes. Its legal representative was changed from Ketuan Zhan to Jihan Wu. Wu Jihan was the executive director, Ketuan Zhan was the manager, and Yuesheng Ge was the supervisor. There was another industrial and commercial change in the mainland. Ketuan Zhan resigned from the manager position and added Wu Jihan as the general manager.

In December 2020, some media reported that Ketuan Zhan and Jihan Wu formally reached an agreement. As a result of the agreement, Ketuan Zhan pledged shares for the time being and lent $600 million from Bitmain to acquire Jihan Wu’s shares; rumors said that the coordinator was Shen Nanpeng of Sequoia Capital.

But now, along with this letter from Wu Jihan, the infighting among the founders of Bitmain has finally subsided.

Judging from the content of the letter, Ketuan Zhan did acquire some of Wu Jihan’s shares at a price of US$600 million. Part of the US$600 million came from Bitmain’s loan and partly from financing-accompanying this acquisition, Wu Jihan from Bitmain stepped down, but at the same time he also got some assets from Bitmain and merged it into BitDeer, and served as the chairman of BitDeer.

From the point of view of personnel appointments, from now until the listing of Bitmain, the board of directors of Bitmain will be composed of 5 people, Ketuan Zhan has the right to appoint 3 of them, and Jihan Wu has the right to appoint the other 2 – it can be seen that Wu Jihan takes Money is gone, but not completely out.

Of course, judging from the letter, Bitmain’s IPO plan is also in the process of being realized.



If there is no more chaos, the infighting between the two founders of Bitmain will come to an end.

However, since Wu Jihan attacked Ketuan Zhan at the end of October 2019, and now the two sides have reconciled, the development of Bitmain as a company has suffered serious internal friction, and its valuation has also suffered a serious decline in the process—— In August 2020, according to the latest data released by the Hurun Research Institute, Bitmain’s valuation dropped by 50 billion yuan to 30 billion.

Today, the valuation of Bitmain has stayed at the level of 30 billion.

With Wu Jihan’s letter of reconciliation, Bitmain in the past was essentially divided into two parts, Bitmain and Bit Deer, which belonged to the two founders of Bitmain.

In this way, Ketuan Zhan and Jihan Wu, who used to work together to start a business together, are now moving towards a break that is closer to the essence in some form of reconciliation.

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