Israeli Cryptocurrency Mining Firm Files for Canadian IPO after 6,500 Percent Gains in Tel Aviv Stock Indices

Last week, cryptocurrency mining company Bitfarms filed a preliminary prospectus with the Ontario Securities Commission (OSC) in a bid to offer public shares on one of Canada’s most prominent bourses, reported Calcalistech on November 12, 2018.

Shifting to Booming Canada

Bitfarms CEO Wes Fulford noted Canada has “one of the most active public markets” in the burgeoning blockchain sector, with the firm’s in-house analysts zeroing down on the locale after thorough research of the world’s most “crypto-friendly” legislation.  

Earlier known as Blockchain Mining, Bitfarms was listed on the Tel Aviv Stock Exchange (TASE) on November 11, 2018, after an impressive 13-month run-up of its shares which saw the company’s stock shoot up by 6,500 percent. The Ontario filing announcement was revealed on the occasion, and presumably even to further amp up investor interests.

The company had modest beginnings and started as a “shelf” company named Natural Resources Holdings. However, October 2017 saw a resurrection in operations as the firm’s owners leveraged capital to build a mining farm after a merger with Canada-based firm Backbone Hosting Solutions.

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The company stock jumped again upon the announcement of the merger, as investors enjoyed their share of the cryptocurrency-hype in 2017. The firm, then known as Blockchain Mining, saw an increase in shares by an unprecedented “thousands of percent” within two months. In a further tryst of fortune, the Israeli Securities Authority (ISA) stepped in to formulate regulations to govern cryptocurrency firms and related businesses to prevent their listing on stock markets, but Bitfarms survived the crackdown and continued to be publicly traded.

New Industry, Traditional Tactics

Bitfarms has opted for traditional fundraising methods like IPOs over its risky and controversial cousin, the ICO. In January 2018, the firm announced plans to offer American Depository Receipts (ADR) on NASDAQ with plans to list on the Toronto Stock Exchange (TSX) by June 2018.

The receipts were offered via the Bank of New York Mellon-issued OTC Pink, the lowest-tier of authorized over-the-counter marketplaces. But in July 2018, the company opted out of the program and offered ordinary-class shares on OTCQX, the top-tier ADR program.

Bitfarm operates four mining farms in the miner-friendly region of Quebec and exclusively focuses on computing Bitcoin, Bitcoin Cash, Ethereum, Litecoin, and Dash. Business has been booming for the firm as well; its first public reports published in August 2018 reported net revenues of $22.3 million for the first half of 2018. Of the figures, $4.9 million was net profit, with the company claiming it mined 1,923 bitcoin, 2,222 bitcoin cash, 3,324 litecoin, 567 ether, and 220 DASH.

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