Tycoons riding on the global wave of bitcoin, other cryptocurrencies are about to learn the extent of their wealth

Some of the world’s biggest cryptocurrency tycoons are about to find out how much they’re really worth.

The secretive bosses of Bitmain Technologies, Canaan Inc. and Ebang International Holdings - three of the largest makers of cryptocurrency mining gear - are all facing the prospect of public-market scrutiny for the first time as they pursue stock listings in Hong Kong. Bitfury, another industry heavyweight, is open to the idea of an initial public offering, though it does not yet have any concrete plans.

If they proceed, the share sales will represent a major test of whether the fortunes amassed by the likes of Bitmain’s Jihan Wu, Canaan’s Zhang Nangeng and Ebang’s Hu Dong are sustainable, or destined to fizzle. While all three companies enjoyed breakneck growth as bitcoin soared 15-fold last year, the cryptocurrency and most of its peers have lost more than half their value in 2018 amid mounting regulatory scrutiny and concerns over exchange security flaws and market manipulation.

The risk is that a lengthy bear market will erode demand for the companies’ specialised computer chips, which miners use to verify virtual currency transactions in a race for crypto-denominated rewards. Bitmain, Canaan and Ebang are trying to adapt their technology for use in other fields such as artificial intelligence, but they’ve yet to prove that the new applications are scalable. Publicly traded shares would offer a real-time gauge of how investors view their prospects.

“These IPOs will be a litmus test,” said Rohit Kulkarni, a managing director for private investment research at SharesPost.