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China tech

China's Bitmain looks to cut half its staff: reports

Maker of cryptocurrency mining hardware faces dip in demand due to lower payouts

Bitcoin will undergo a "halving" in May that reduces payouts for mining -- performing the computations needed to circulate the cryptocurrency.   © Reuters

GUANGZHOU -- Bitmain Technologies, the world's leading producer of cryptocurrency mining hardware, plans to slash its workforce by around half, local media reports say.

The potential layoffs at the Chinese company come as the price of bitcoin hovers below $8,000, having plunged from the peak of roughly $20,000 two years ago.

An anticipated 50% reduction in payouts for bitcoin mining -- updating the blockchain ledgers that underpin cryptocurrencies -- also risks undercutting demand for the computers needed for this work.

The reports add to the uncertainty around Bitmain's apparent plans for an initial public offering in the U.S. this year.

Most of Bitmain's roughly 1,500 workers are engineers. Artificial intelligence specialists will bear the brunt of the job cuts, according to media reports.

Bitmain also runs its own cryptocurrency mining operation. The startup, founded in 2013, grew in scale with the spread of crypto trading.

Demand for Bitmain's equipment is linked to rewards for crypto mining, which are paid in cryptocurrency. Bitcoin undergoes "halvings" that limit the circulation of the digital currency, as well as payouts. The next halving is slated to occur in May.

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