The Glamorous Transformation of Cangu: From Car Dealership to Crypto Mining

Recently, Cangu Company has frequently released important announcements, indicating a significant transformation in its business. The company announced the acquisition of operational crypto mining equipment with a hash rate of 32Eh/s for a price of $256 million, and plans to further acquire operational mining equipment with a hash rate of 18Eh/s by issuing $144 million in stock. In addition, the company's Bitcoin output in November reached 393 coins.

These measures mark the official entry of Cangu into the crypto mining field. The 32Eh/s mining equipment acquired in the first phase is distributed across five countries, including the United States, the Middle East, and Africa. These devices are primarily flagship S19 miners, which are expected to have a depreciation period of about 4 years. It is worth noting that the shutdown price for this batch of equipment is approximately $70,000 per bitcoin, which already includes the hosting operational costs.

The funds required for the acquisition of the 18Eh/s equipment planned in the second phase will be raised through a targeted stock issuance, expected to complete the transaction by March 2025. The targeted issuers are an investment group composed of 9 individuals. At the same time, the company has also signed a supplementary agreement as an incentive measure. If the company's market value reaches a specific level for 30 consecutive trading days within the next 30 months, these investors will receive an additional share reward valued at $97.1055 million.

Although Bitcoin prices have seen a significant increase recently, the acquisition price by Canggu remains relatively reasonable. This is because the company had already started engaging with related projects when Bitcoin prices were in the range of 60,000 to 70,000 USD and reached preliminary agreements with the sellers.

After completing these acquisitions, Cangu will completely transform into a company focused on self-operated crypto mining. The company plans to further expand its business scope based on this, venturing into areas such as computing power leasing and cloud hosting, in order to smooth out the profit fluctuations caused by Bitcoin price volatility.

From an investment perspective, the outlook for Canggu seems quite optimistic. It is expected that after completing the full acquisition by March 2025, the company's operational hash rate will reach 50 Eh/s, likely becoming the largest mining company among publicly listed companies in the United States. Compared to other North American mining companies, such as Marathon Digital with a hash rate of 46 Eh/s and a market value of $7.9 billion, and Cleanspark with a hash rate of 32 EH/s and a market value of $3.6 billion, Canggu's valuation appears to be significantly underestimated.

Based on a valuation benchmark of $110 million per Eh/s, the theoretical market value of Cangu should reach $5.5 billion after completing the second batch of acquisitions. Considering the company's current market value of only $720 million, this indicates that Cangu's stock price may have an upside potential of 3.9 to 6.6 times. However, investors should remain cautious when making decisions and fully consider the market risks and uncertainties in the company's future development.