Bitmain Secretly Using Mining Rigs to Mine Cryptos for Itself, Lawsuit Alleges
Bitmain allegedly configured its recent cryptocurrency mining units to mine for itself using the resources paid by its users, all without their knowledge.
That was the central point of the US$5 million class-action lawsuit filed a group of mostly Bitmain customers against the Chinese mining giant on a United States court this earlier this month.
The case claimed that Bitmain rigs inconspicuously mined cryptos while users are navigating through the units’ arduous setup processes.
In connection to that claim, the plaintiffs also alleged the manufacturer of intentionally making the duration required to configure the miners long enough, which could stretch to a few days, to maximize the time the units could mine cryptos in secret.
The lawsuit read:
“Conveniently, Bitmain cashes in on every second it takes to get the ASIC configured with the customers’ specifications and lays the substantial costs of operating the ASIC devices at the feet of its customers.”
Bitmain dominates the crypto mining industry, with one study suggesting that the Chinese company owns 85 percent of the total mining chips on the market. The manufacturer produces the Antminer series, which are some of the most popular application-specific integrated chip (ASIC) miners around.
This lawsuit could harm the planned initial public offering (IPO) of Bitmain scheduled any time between the fourth quarter of 2018 and the first quarter of next year.