A U.S. publicly-listed Chinese sports lottery firm is extending its arms into the crypto industry by announcing another related maneuver. 500.com Ltd announced it has acquired Btc.com, the well known bitcoin mining pool.
Jihan Wu Is the â€˜ Biggest Beneficial Ownerâ€™ of the Mining Pool
Per the announcement, the online lottery service provider bought the company from Blockchain Alliance. 500.com performed the transaction by issuing newly class A shares, representing almost a 10% stake in the listed Chinese company.
According to the filings, 500.com Ltd made the share exchange agreement with Blockchain Alliance Technologies Holding Company, a Cayman Islands-based firm. Currently, the Chinese lottery provider giant has a market capitalization of $860 million, and the transaction specifies some conditions.
One of them includes the profits generated by Btc.com, which in case that such net figures are no less than $20 million by the end of 2021, the current shareholders will get up to a 5% stake in 500.com Ltd.
It means that a maximum of 22,176,718 additional â€œClass A Ordinary Sharesâ€ shall be issuable, stated the announcement. The first transaction under the agreement is expected to happen on or before April 15, 2021.
Bitdeer Technologies Holding Company is the operator of the pool. Moreover, its â€œbiggest beneficial ownerâ€ is currently is Bitmain co-founder Jihan Wu.
Btc.com claims to have over 10% of bitcoin (BTC) hashrate, becoming one of the top five largest mining pools globally.
Not the First Crypto-Related Business Maneuver Made by 500.com
But 2020 wasnâ€™t a good year for the Chinese lottery service provider. According to the yearly figures, the company posted around $29.9 million in losses over 2020.
However, 500.com started the year on a bullish note due to a significant bitcoin mining-related acquisition. As news.Bitcoin.com reported earlier in January, the company reached an initial agreement to acquire BTC mining machines from an unnamed non-U.S. seller.
The full amount of the transaction â€” $14.4 million â€” will allow the company to acquire the machines, including such models as the M20s from Microbt S17, T17, and S9 units from Bitmain.
What do you think about the latest 500.com crypto-related acquisition? Let us know in the comments section below.