Chinese Electric Vehicle company Kaixin Holdings is looking at plans to acquire a mining facility in the Middle East to begin its mining operations. This development is coming after China’s shift in its crypto regulations after several bans over the last few years.
In its statement, Kaixin Holdings is focused on actualizing the dream as soon as possible. The company is looking at cost-efficient mining equipment and adequate energy to begin its operations. The company intends to run its automobile venture with its crypto-mining outfit, enabling it to utilize the same sustainable operations expertise in the crypto-mining venture.
Kaixin’s market performance raises questions
The recent market performance of Kaixin gas raised a flurry of questions among its stakeholders. One such worry is its ability to combine its mining venture with its automobile business. The company also faced an 81% decline in top-line performance last year.
However, the company’s medium-term growth is still good as it is expected to increase by 4.3% in the coming year. The company has also maintained its price-to-sales average, showing that investors are still worried about its ability to continue its growth from last year.
Despite all this, the company’s move into the crypto industry could mean well over the next few years. The new venture is also seen as a way to diversify its business by banking on the growth in the crypto market. Notably, the global crypto industry is in a good place, having recently topped above $3 trillion some days ago.
China is trying to re-enter the crypto industry
Kaixin’s decision to float its mining outfit is part of a larger trend experienced in China. Despite the country’s decision to ban crypto and related activities in 2021, firms and individuals are quietly re-entering the space. This is not surprising seeing as the market growth has exceeded the imagination of traders.
Aside from Kaixin, firms like Nano Labs are seriously looking into blockchain technology, digital currencies, and the ability to offer crypto payment services worldwide. While the crypto ban from 2021 is still effective, the country has shown its commitment towards blockchain. It has also progressed the development of its digital currency, the digital yuan (e-CNY).
Kaixin’s decision to enter the crypto industry is regarded as a means to diversify its business as China moves towards re-entering the industry. While this is discussed, there is a likelihood that the country may consider lifting its ban on the sector and its participants. Although China is serious about its ban on crypto within the country, it still recognizes its potential internationally.