In the last months of 2024, the bitcoin mining industry saw a significant shift as Cango (CANG) - a $363 million Chinese auto lending company - officially entered the space. Cango is acquiring 50 exahash per second (EH/s) of mining capacity, aiming to become one of the largest bitcoin mining companies in the world. The company invested $256 million in cash for the first 32 EH/s from Bitmain and plans to issue $144 million in shares to acquire an additional 18 EH/s from Golden TechGen and other sellers, resulting in these sellers owning approximately 37.8% of Cango. Cango's stock rose over 362% by the end of the year due to significant interest from the new mining venture. Previously focused mainly on auto loans, Cango has expanded its investments into various areas, including electric vehicles and renewable energy, before venturing into bitcoin mining. The company expects to provide about 6% of the total computing power of Bitcoin when fully operational, although it currently relies heavily on Bitmain for infrastructure and operations. Cango is considering reducing its bitcoin holdings based on market conditions after mining 363.9 BTC in November 2024, equivalent to about $35 million at that time.
The reorganization plan for the FTX cryptocurrency exchange after its bankruptcy took effect on January 3, allowing users to begin reclaiming funds. Eligible users must submit a claim on FTX's official website, with initial payments expected for those claiming $50,000 or less within 60 days. This plan, approved in October, predicts that 98% of FTX users will recover 119% of the amount they claimed. This comes after a series of legal issues for FTX, including several executives being convicted of fraud. While two directors avoided prison time, former CEO Sam Bankman-Fried has appealed the sentence. Additionally, the repayment has faced criticism from creditors as the refunds are based on cryptocurrency prices at the time of FTX's bankruptcy. Cryptocurrency companies BitGo and Kraken will assist in distributing the funds, with total payouts expected to reach around $16 billion if all claims are made.
Overall, the cryptocurrency industry is in a phase of volatility and strong growth, with many new events and factors affecting the market. Cango and FTX are two typical examples of the notable changes taking place. Market participants need to continue monitoring and adjusting their strategies to adapt to this challenging and potentially rewarding environment.
