Bitcoin mining hardware maker Canaan Inc. has secured a significant $72 million strategic equity investment. The announcement, made on Tuesday, confirms participation from top-tier institutional investors, including Galaxy Digital, Weiss Asset Management, and Brevan Howard Digital. This funding comes at a time when Canaan reinforces mining focus.
The transaction was executed via a registered direct offering. Investors purchased 63.7 million American depositary shares (ADS) at a price of $1.13 per share. According to Canaan, this capital injection will bolster its balance sheet. It will also reduce dependence on future “at-the-market” (ATM) capital raises, marking a shift toward investors focused on company fundamentals.
This financial move supports a key strategic pivot for the company. Canaan, listed on Nasdaq since 2019, had previously explored diversification into artificial intelligence. However, the company announced in June it would discontinue its AI hardware efforts. CEO Nangeng Zhang stated the strategic path is to double down on “core strengths” in crypto infrastructure and Bitcoin mining.
Is abandoning AI the key to dominating the US market?
Canaan’s strategy is now centered on ASIC chip design and high-performance computing equipment for the Bitcoin blockchain. This focus aligns with its expansion in the United States. The US market accounts for nearly 38% of the global Bitcoin hashrate. To capitalize on this, Canaan completed a pilot production run in the US in June, aiming to reduce delivery times to regional customers.
Confidence in Canaan’s new direction had already shown positive signs. In October, the company’s stock rose over 26% after announcing a 50,000-rig order from an unidentified US company. This was its largest order in over three years. Following the announcement of the new $72 million financing, Canaan (CAN) shares showed a rally of approximately 9% in intraday trading on Nasdaq.
With backing from giants like Galaxy and Brevan Howard, Canaan reinforces mining focus for the future. The funds will be used to scale production in the United States. This move seeks to solidify its position in the competitive mining hardware market, definitively abandoning AI distractions to concentrate on its core business.
