Crypto consultancy Blockchain Global receives second winding up application

Melbourne-based Blockchain Global has had a winding up application lodged against it.

Cryptocurrency consultancy Blockchain Global has had a winding up application lodged against it for the second time this year.

Queensland-based Guangsen Nie and Keqi Yao this month lodged a winding up application against the company which was behind the failed attempt to list Bitcoin Group on the ASX in 2016.

This follows a winding up application which was lodged in May this year, and then dismissed in June.

Bitcoin Group, headed by cryptocurrency entrepreneur Sam Lee, lodged a prospectus with the ASX in July 2015, and was looking to raise $20m.

At the time it was touted as the first cryptocurrency miner in the world to run an initial public offer, however the IPO was pulled and investors’ money refunded in early 2016.

This followed the prospectus being revised three times on orders from the Australian Securities and Investments Commission.

The company was aiming to earn 25 to 50 bitcoins per day through its bitcoin mining centres in China, which at the time, would have generated about $32,000 per day with bitcoin then valued at $640.

At the current bitcoin price of $75,630, that mining rate would have generated $3.78m per day, or $1.37bn per year, dependent on the company’s ability to maintain that rate.

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The company rebranded as Blockchain Global in 2016 and legally changed its name.

The Blockchain Global website says the company is “one of the oldest and most active venture investors in the blockchain industry’’ run out of Hong Kong “with regional offices in Melbourne, Dubai, Shanghai, Zurich and Panama’’.

“We seek to provide a pathway to institutional-grade strategic capital that bring domain expertise, partnerships and technology to help companies solve problems, fill gaps and grow,’’ the website says.

“Since inception, we have financed 400-plus companies, projects and deals. As multistage investors, we have invested in and facilitated transactions with over a dozen listed companies, private equity and tokens.’’

The company says it actively manages more than $400m worth of investments, with its portfolio companies employing more than 2000 people globally.

Blockchain Global’s most-recently lodged Australian financial report, for the 2017 financial year, shows it made a loss of $1.52m, up from a loss of $600,485 the previous year.

The company made $78,892 from mining bitcoin, down from $5.83m the previous year.

At that time, Blockchain Global says in the report, it was the largest shareholder in listed company DigitalX, with a 21. per cent shareholding.

This dropped to 12.4 per cent by the end of the following financial year and 3.07 per cent by 2020.

Blockchain Global is no longer listed as a substantial shareholder in DigitalX however the latter company’s latest annual report shows it holds 4.5 million options in the company which are all currently out of the money.

The Australian has attempted to contact Bitcoin Global at each of its three Australian-based offices.

The lawyers for the individuals behind the court action have also been contacted.

The winding up application is set to return to the federal Court in Brisbane on October 22.