Editor's Note: This article comes fromHoneycomb Finance News (ID: fengchao-caijing), Author: Hoho, reprinted by Odaily with authorization.

Editor's Note: This article comes from

Honeycomb Finance News (ID: fengchao-caijing)

Honeycomb Finance News (ID: fengchao-caijing)

, Author: Hoho, reprinted by Odaily with authorization.

This is Bitmain's second mass layoff. According to a person familiar with the matter, the reason for the layoffs is related to the imminent halving of Bitcoin in May this year. Wu Jihan is not optimistic about the halving, and the company has streamlined for the “winter”; in addition, because the AI ​​​​business cannot generate profits, it has become a key optimization target.

The so-called N+1 is simply a way for companies to compensate employees when laying off employees. N is based on the number of years the employee has worked in the employer, and one month's salary will be compensated for each full year. "+1" means to compensate employees for one month's wages on this basis, and "+2" means to compensate employees for two months' wages.

Employees care about compensation, while Ketuan Zhan, the former chairman of Bitmain, cares about the impact of layoffs on the company. In his open letter, he called the layoffs "a near-suicidal wrong decision."

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Ketuan Zhan called layoffs "playing suicide"

On October 29, 2019, Ketuan Zhan was stripped of all his positions in Bitmain by Jihan Wu as the founder and chairman of the board of directors of Bitmain. Rumors then surfaced that Zhan took legal action to the courts in an attempt to regain the position. As of now, there is no latest development in the case. But his voice brought the outside world's attention to Bitmain to a climax.

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Two times of layoffs, AI has become the hardest hit area

Founded in 2013, Bitmain rose rapidly in the industry's bull market in 2017. It once became an industry monopoly occupying 70% of the mining machine market. The company's staff also climbed from a few hundred to more than 3,000.

The last round of large-scale layoffs occurred in February 2019. At that time, the scope of layoffs included multiple business lines such as blockchain, artificial intelligence, and chips.

Jiemian News quoted a former employee who was close to the core layer of Bitmain to estimate that before the initial layoffs, Bitmain had about 3,000 employees, including more than 1,000 employees in marketing, sales, and administration, and about 2,000 employees in the mining machine department and AI department. people. After the layoffs, the total number of Bitmain employees has shrunk to more than 1,000, of which the AI ​​business has been laid off.

Interestingly, Ketuan Zhan, who advocated against layoffs this time, was at the helm of Bitmain's last round of large-scale layoffs.

According to the National Enterprise Credit Information Publicity System, Ketuan Zhan has served as the executive director of Bitmain since November 2018, and was not replaced until October 28, 2019. The company's 2018 prospectus shows that Ketuan Zhan holds 36% of the company's largest shareholder, far exceeding the second largest shareholder Wu Jihan's 20.25%. According to this ratio, from 2018 to 2019, the actual controller of Bitmain at that time was Ketuan Zhan.

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Ketuan Zhan quit Bitmain management

At that time, although Ketuan Zhan also drastically reduced the personnel of the AI ​​​​department, when he was at the helm of Bitmain, he once strongly advocated cutting the advantages of computing power accumulated in the mining field into the AI ​​​​field.

In this round of layoffs, the dismissed "non-staff" personnel Zhan Ketuan made a wave of presence as an opponent. When he saw media reports that "R&D personnel are the focus of this layoff, and the Al business will be cut by two-thirds", he insisted in the open letter that Bitmain should keep the AI ​​business.

If it is further reduced by 1/3, the number of people in Bitmain will not exceed a thousand. After going around and around, the mining giant has almost returned to the original point in terms of employee size.

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The road to raising AI with mining machines is difficult

After two layoffs, the AI ​​department could not escape being streamlined. Ketuan Zhan, who lost his position temporarily, was once the executive who led the research and development of AI chips. Some voices believe that the AI ​​department has become a victim of Bitmain’s “infighting”. There is no way to study the battle in the workplace, and the reality of AI artificial intelligence burning money is in front of us. According to analysis by industry insiders, the huge investment in artificial intelligence is fiercely competitive, and Bitmain’s AI chips are nowhere in sight for independent profitability. This may be the real reason for the total “injury” of the AI ​​​​business.

In the global chip industry chain, equipment such as face recognition, autonomous driving, and smart security have huge demands for AI chips. Market research firm ReportLinker estimates that by 2023, the global AI chip market will reach US$10.8 billion, with a compound annual growth rate of 53.6%. According to the forecast of another institution, Allied Market Research, by 2025, the AI ​​chip market size will be 37.8 billion US dollars, with a compound annual growth rate of 40.8%.

Both forecasts make it clear that the market for the AI ​​chip industry is huge, and the growth rate is astonishing. In this field, Bitmain, which was born in the research and sales of mining machine chips, can be regarded as a cross-border player, and its opponents are no longer limited to the currency circle.

At present, AI chips can be divided into two usage scenarios of cloud (server) and terminal (mobile) chips. Most companies that develop AI chips focus on one end. Internet giants such as Nvidia, Intel, IBM, and Google mainly focus on the development of cloud chips, while ARM, Horizon, and Shenjian Technology mainly focus on the development of terminal chips.

In 2017, Bitmain announced its entry into the AI ​​chip industry. The subsequent prospectus showed that the AI ​​chip business will be the company's strategic focus, and the funds raised from the IPO will also be used for the research and development and expansion of production of high-tech AI chips and AI applications. However, as the listing plan came to an end without a problem, the fundraising was gone. Since then, the research and development of AI business has almost entirely depended on the profit transfusion of mining machines.

On the other hand, companies such as Cambrian and Horizon have completed several rounds of financing during this period, and the "unicorns" have already made sufficient preparations in terms of funds, let alone AI giants such as Google and IBM.

The investment is huge, but the effect is not obvious. Bitmain's practice of "supporting AI with mining machines" is also under double pressure from inside and outside.

According to public information, as of now, Bitmain has released three AI chips under the brand of Sufeng, namely BM1680, BM1682 and BM1684. Jiemian News quoted a person familiar with the matter as saying that Bitmain’s AI chip shipments are very small, “Because the chips are not stable enough, some of them will be returned by customers.”

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