The CEO of Nasdaq-listed Canaan Inc, a China-based company specializing in Bitcoin (BTC) mining equipment, argued that China’s Bitcoin mining ban should take green power users into account during a conference call Tuesday .
Zhang Nangeng said an indiscriminate ban on bitcoin mining failed to take into account the potential economic benefits that could come from adopting green energy mining. Zhang said mining could provide a solution to the electricity oversupply in certain regions of the country where the resulting low energy prices are already attracting miners.
“For-profit miners prefer regions with low electricity prices that indicate oversupply and likely waste of energy. Bitcoin miners also help create jobs in impoverished regions and contribute to tax coffers, ”said Zhang.
Canaan’s stock price rose 24% on Tuesday, contributing 42% growth for the week. The surge in Canaan’s share price came amid the release of the company’s financial results for the first quarter of the year, which have shown spectacular growth since that point in 2020.
The company’s revenue increased 490% year over year, primarily from sales of its ASIC mining equipment. The company also posted net income of $ 22.4 million, following a net loss of $ 5.9 million the previous year.
“Our financial performance improved significantly in the quarter, driven by the Bitcoin price rally, increased customer demand for quality mining equipment, and our ability to increase mining equipment production and shipments,” Nangeng wrote in the quarterly report.
The rise in the company’s share price represents a quick turnaround after falling 41% over the previous month amid the fall in Bitcoin prices. The company’s business outlook forecast an increase in sales but did not provide any further financial guidance due to the volatility in the value of Bitcoin, which is affecting mining demand.
“The company recognizes that the development of Bitcoin prices is difficult to predict at the moment and cannot provide financial guidance due to Bitcoin price volatility at the end of May this year,” the report said.