Phoenix group’s IPO to be the first crypto blockchain IPO in UAE

Phoenix group’s IPO to be the first crypto blockchain IPO in UAE

UAE Crypto mining entity Phoenix Group announced on Linkedin, their eminent preparation for a landmark IPO (Initial public offering) on the Abu Dhabi Securities Exchange.

As noted on LinkedIn, “We’re thrilled to announce that we are gearing up for a landmark Initial Public Offering (IPO) on the Abu Dhabi Securities Exchange. As a pioneering technology conglomerate specializing in cutting-edge blockchain and crypto solutions, this marks a significant milestone for us and the UAE. We’re the first crypto and blockchain entity to be listed in the #UAE.”

Founded in 2017 by Bijan Alizadeh and Munaf Ali, Phoenix is set to be the first privately owned crypto and blockchain entity to be listed on a Middle East stock market.

In an interview Bijan Alizadeh, Phoenix Group CEO and Munaf Ali, the Phoenix Group’s managing director stated, “Our journey, originating from the heart of Abu Dhabi, has always been visionary, looking beyond borders and horizons. Today, as we stand at the cusp of this significant milestone, we are not just announcing an intention to IPO – we are sharing our commitment to a future where technology knows no boundaries.”

The company aims to be able to help create a more resilient, inclusive, and diversified global blockchain economy, and listing is just the first step towards achieving that goal.

Alizadeh adds,“Our aim has always been to champion innovation and contribute to Abu Dhabi’s positioning in the global tech landscape. This landmark announcement offers local, regional and global investors the opportunity to participate in making this iconic vision, a reality.”

Phoenix Group  has a total installed capacity of 725 MW across the UAE, Oman, US, Canada and Commonwealth of Independent States (CIS) countries, Phoenix specialises in a range of services, from high-performance computing to crypto and cloud mining, data centre hosting, crypto trading, and crypto mining products and equipment.

Earlier this month Phoenix group announced that it had sold 10% of its company shares to Abu Dhabi conglomerate International Holding Company’s subsidiary.

This announcement came at the heels of an agreement between Muscat-based Green Data City and Phoenix Group to develop a $300 million crypto-mining farm in Oman. The 150-megawatt farm, which will be one of the largest crypto-mining data centers in the region, will be installed in Green Data City, the entities said in a joint statement.

Crypto mining firm Phoenix Group sells 10% of its shares to Abu Dhabi IHC

Crypto mining firm Phoenix Group sells 10% of its shares to Abu Dhabi IHC

UAE based Phoenix Group has sold 10% of its company shares to Abu Dhabi conglomerate International Holding Company’s subsidiary.

IHC’s wholly owned unit, International Tech Group, has entered into a definitive agreement to buy 10% stake in Phoenix Group, according to a disclosure on the Abu Dhabi Securities Exchange (ADX).

The company is currently completing all required procedures and obtaining regulatory approvals to complete the transaction, the disclosure noted.

This announcement comes at the heels of an agreement between Muscat-based Green Data City and Phoenix Group to develop a $300 million crypto-mining farm in Oman. The 150-megawatt farm, which will be one of the largest crypto-mining data centers in the region, will be installed in Green Data City, the entities said in a joint statement. The farm is expected to be fully operational by the second quarter of next year.

Pheonix Group had announced on several occasions that it was seeking to have an IPO ( Initial Public Offering). With the 10% acquisition by IHC this could well put the IPO on hold.

Phoenix provides crypto-mining equipment distribution and hosting services. The company has a portfolio of mining facilities in the Middle East, Europe, the US, and Canada.

In the first half (H1) of 2023, IHC  generated net profits valued at AED 10.39 billion, up from AED 10.35 billion during the same period a year earlier.

This is a reflection of Abu Dhabi’s government interest in crypto mining. Prior to this Marathon Digital a digital asset mining entity announced in January 27th 2022, that it had entered into a shareholder’s agreement with FSI ( FS Innovation), the BTC mining subsidiary of UAE ADQ a sovereign fund,  to form an Abu Dhabi, ( ADGM (Abu Dhabi Global Markets) based company.

Marathong Digital will use fossil fule offset or nuclear to power bitcoin mining operation.

UAE crypto mining hardware retailer to invest $300 million in global expansions

UAE crypto mining hardware retailer to invest $300 million in global expansions

Amidst what some might consider as bearish markets especially for the crypto mining industry given high energy prices and decreased value in crypto markets, UAE’s crypto mining hardware retailer, Phoenix Technology is investing $300 million in crypto mining sites across the globe.

As per recent news, Phoenix Technology is developing a large scale site in the United States which will be launched in Q2 of 2023. The site will utilize the latest mining technologies including immersive cooling.

Carl Agren, CEO of Phoenix Technology, stated, “Phoenix Technology is aiming to switch from a regional player in the mining space to a global one. In other words, developing, maintaining, and operating sites all around the world. We have been currently focusing on the North American markets, mainly the US and Canada. However, we are planning on setting foot in other regions to try to identify opportunities in untapped mining areas. We are devoting $300 million to be invested in different sites that are development opportunities, under development, or currently operational.”

The company has also signed a strategic partnership with MicroBT, blockchain and AI entity, making it the exclusive sales partner of WhatsMiner in the MENA region.

Phoenix Technology has claimed that it will develop partnerships with other companies that are also pushing the boundaries of mining, such as gas flaring, to bring more technologically advanced solutions to the local market and globally.

Recently Munaf Ali, founder and CEO of UAE-based Phoenix Group, stated that he believes MENA is fast moving toward crypto and blockchain adoption. In the interview he explains, “The Middle East is fast helping the global diversification of jurisdictions which are friendly to operate in. This goes for countries where crypto firms can set up, whether they are crypto exchanges or mining operations.”

In November 2021, Phoenix Technology announced that it signed one of the world’s largest purchases on record for crypto mining rigs, worth US $650 million. In an interview Munaf Ali stated that Phoenix was part of a project that would be developing a large scale crypto mining farm in the UAE.

The GCC and MENA region very attractive destination for crypto mining

The GCC and MENA region very attractive destination for crypto mining

Crypto mining is an integral part of the development of crypto economies. As the MENA region opens up its economy to digitization and crypto-related activities and as the world is challenged by an ongoing energy crisis, MENA is probing to become an attractive destination for crypto mining.

While the biggest crypto mining markets are currently in the USA, China, Kazakhstan and Canada, the energy crisis and the crypto bear market could help the GCC become a leading crypto mining hub.

Mohamed El Masri, founder and CEO of Permianchain, which operates Bitcoin mining data centers in Canada using wasted energy, states, “The adoption and implementation of blockchain data center infrastructure can support the digital stability and financial security of the GCC region. Hypothetically, the GCC has the opportunity to attract close to $1.0 trillion in economic growth by laying the groundwork for powering the digital economy.”

El Masri confirms the main challenge is calling out the financial regulators, mainly in the financial free zones, to stop taking the “enforceability approach” and take a “regulate-first approach.”

Nonrenewable resources to boost mining 

El Masri also mentions that given that the GCC is an oil and gas-rich region, there is an abundance of natural gas energy being wasted each day. Notably, such gas energy supports the implementation and commissioning of low-cost power plants to attract bitcoin mining companies from all over the world to set up in the region.

According to him, this will allow the region to become a leader in providing field-generated electricity “to power the future digital economy all while reducing emissions and decarbonizing the GCC’s oil and gas sector.”

The World Bank has reported that the MENA region accounted for 40% of the world’s flaring, with Iran, Iraq and Algeria generating 75% of MENA’s flaring. Meanwhile, Saudi Arabia, Kuwait, UAE and Qatar have low flaring intensity.

Adopting new technologies

Munaf Ali, founder and CEO of UAE-based Phoenix Group, involved in crypto mining equipment sales and projects, believes MENA is fast moving toward crypto and blockchain adoption.

“The Middle East is fast helping the global diversification of jurisdictions which are friendly to operate in,” Ali states. “This goes for countries where crypto firms can set up, whether they are crypto exchanges or mining operations.”

Ali confirms that GCC governments have started to address this by recognizing these new business activities and are issuing licenses to crypto market participants.

The Phoenix CEO espoused other benefits, including job creation, the development of a green renewable energy industry, and the generation of crypto/USD for circulation inside the local economy which in turn boosts economic activity.

Growing interest in mining

UAE investment firms have also shown interest in crypto mining investments. Nabyl Al Maskari, executive chairman of Al Maskari Holding, in a panel discussion during the Security Token Summit in June 2022, noted that there will be significant crypto mining investments happening in the UAE.

“We will have significant crypto-mining investments because the UAE is a low-cost energy producer,” Al Maskari certifies. “We are in the solar belt and have nuclear power with two reactors online. We can as such mine green Bitcoin or other tokens that come out.”

During Binance Week 2022, Khalifa AlJaziri, AlShehhi, Commercial Affairs Regulatory Sector Projects advisor at the Ministry of Economy in UAE, claimed that the Dubai World Trade Center Authority (DWTCA) would be legislating the crypto mining sector. He stated, “We are setting the guidelines and rules needed to regulate crypto mining within this crypto framework.

The UAE is not the only country that has shown interest in crypto mining. Oman Investment Authority (OIA) took part in a $350mn equity round in Crusoe Energy Systems. The US firm helps oil and gas producers cut flaring by using stranded natural gas to power cryptocurrency mining. Crusoe systems set up operations in Oman as well. 

Pierre Samaties, global head of Crypto Economy and Energy, reaffirmed that Bitcoin mining in the region is growing.

“Given we have a huge difference between the summer load curve and the winter load curve, Bitcoin mining helps to support renewable energy investments to increase utilization of the asset by using it during downtimes for Bitcoin mining,” Samaties says. The executive says this helps to balance the energy system.

Samaties also affirms that Bitcoin mining is seen as a strategic asset, a cornerstone for building a crypto economy in the region.

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