Jihan Wu, the co-founder of crypto mining products provider Bitmain, announced he will resign as CEO to resolve a year-long dispute with Micree Zhan, the other co-founder, according to an internal letter he issued.
In the letter, Wu referred to this way of settling the matter as “friendly, and more importantly, constructive.”
As he steps down from the position, Zhan will purchase shares previously held by a group of founding shareholders – including Wu – under the code name “Bitsource”, for a total of $600 million. This accounts for nearly half of Bitmain’s total shares.
In order to complete the share purchase, Zhan has requested a $400 million loan from Bitmain and promised to raise another $200 million from outside the company.
According to the letter, the new board of Bitmain will consist of five members, including three appointed by Zhan and two by Wu.
The company had submitted a prospectus to the Hong Kong Exchanges and Clearing in September 2018, which showed that Zhan’s fund holds 36% of the company shares and was the largest shareholder while Wu’s fund holds 20.25% of the shares and was the second-largest shareholder.
On Oct. 31, 2020, the day when blockchain giant Canaan submitted its prospectus to Nasdaq, Wu sent an email to the staff, claiming to dismiss all positions of Zhan in Bitmain without offering any specific reasons. Zhan expressed his shock and embarrassment when he first heard the news a week later, saying he felt betrayed by his most trusted partner.
Wu would then reveal that although he respected Zhan as a co-founder, he thought the latter destroyed Bitmain’s upward momentum along with billions of dollars in value, according to people familiar with the matter.
Then in June last year, Zhan publicly apologized for the chaos the senior personnel created and promised to settle the disagreement and attached legal disputes as soon as possible.
According to Wu’s letter, Bitmain will separate from its cloud computing power business Bitdeer as well as its mines in Norway and the U.S. Wu will become the chairman of Bitdeer while Matt Kong will act as the firm’s CEO. Bitcoin mining pool AntPool, a brand owned by Bitmain, will be spun off as an independent company led by Zhan.
“I’ve enjoyed the 2815-day journey in Bitmain and am grateful for the unconditional help and support from the clients, colleagues and friends,” Wu said at the end of the letter. “Meanwhile, I would like to send my sincerest blessings to Zhan and Bitmain.”