Mining rig maker Canaan raises $50 million in preferred shares financing

Crypto mining rig maker Canaan has raised over $50 million through preferred shares financing to enhance its research and development capabilities and expand production scale.

The Nasdaq-listed company disclosed in a filing this week that it raised the capital from an institutional investor by issuing and selling up to 125,000 series A convertible preferred shares. The company did not name the investor.

“The company intends to use the net proceeds from the sale of the securities for research and development, expansion of production scale, and other general corporate purposes,” Canaan said in the filing.

Canaan’s stock closed down 6.45% at $1.45 on Thursday. Its stock has seen a 32.87% decline since the beginning of this month.

In the third quarter of last year, the mining rig maker reported a net loss of $80.1 million, compared to a net income of $6.3 million in the same period of 2022, its earnings report showed.

Earlier this month, Canaan announced securing follow-on purchase orders for over 17,000 bitcoin mining machines from Cipher Mining Inc. and Stronghold Digital Mining Inc. — both of which are also Nasdaq-listed companies.