A civil war broke out at the cryptocurrency giant Bitmain on Thursday after ousted co-founder Micree Ketuan Zhan threatened to take legal action to seize back control of the company.
Mr Zhan said he was unwillingly removed from his position as chairman of the company, which claims to supply three-quarters of the world’s bitcoin minting machines, while he was away on a business trip.
He wrote that he was stabbed in the back by “my most-trusted partner and a brother who fought beside me”, in an open letter posted to his WeChat social media account.
“As Bitmain’s founder and largest shareholder, it’s embarrassing that I never knew a government registered legal representative of a firm could suddenly be changed when he was away on a business trip and without him knowing anything,” Mr Zhan wrote.
Last week his co-founder Wu Jihan returned to the company after an absence and replaced Mr Zhan’s name on the company’s registration documents with his own. Mr Wu also threatened employees with punishment if they continued to meet or communicate with Mr Zhan or carry out any of his instructions.
Mr Zhan told Bitmain staff and shareholders in his letter he would take all legal measures to come back to the company as soon as possible.
“Bitmain is our child, I will try my best to protect her! I will take up the weapon of law and not let any schemes that attempt to harm and prey on Bitmain succeed,” Mr Zhan wrote.
Bitmain had stationed several security guards around its offices on the outskirts of Beijing — apparently to keep Mr Zhan out — when a Financial Times reporter visited over the weekend. Outside the locked doors on one office building floor, seven men dressed in black suits watched over an empty hallway.
Mr Wu and Mr Zhan have differing visions for the company’s future, with Mr Zhan keen to push the company into AI chip development while Mr Wu advocates for blockchain technology and the offshoot currency bitcoin Cash.
In his open letter, Mr Zhan estimated that in addition to claiming 90 per cent of the world’s market for bitcoin mining machines, Bitmain’s AI business would generate Rmb100m ($14.3m) in revenue this year and possibly Rmb1bn next year.
Bitmain had filed for a public offering in Hong Kong but shelved it this year as bitcoin’s price plunged, spooking investors and leading to the lay-off of hundreds of employees.
“Everyone is on Wu Jihan’s side except for Zhan’s assistant. People in the bitcoin circle believe in blockchain and cryptocurrency, not AI, and they blame last year’s mass lay-off on Zhan Ketuan,” said Liu Feng, editor-in-chief of Chinese crypto news outlet ChainNews.
The power struggle for control of China’s top bitcoin mining firm has emerged as President Xi Jinping called for China to focus on developing the blockchain technology that underpins bitcoin.