Chinese sports lottery service 500.com has acquired a major Bitcoin (BTC) mining pool, BTC.com.
500.com has entered into a share exchange agreement with Blockchain Alliance Technologies Holding Company in the Cayman Islands, according to a Feb. 16 announcement.
As part of the deal, 500.com will acquire the entire mining pool business of Bitdeer Technologies Holding Company, including the domain name and a cryptocurrency wallet. Both the domain name and the wallet are operating under BTC.com, but belong to Bitdeer, which is the parent company of Blockchain Alliance.
According to the announcement, the first transaction under the share exchange agreement is expected to occur on or before April 15, 2021.
500.com and Blockchain Alliance have also made certain agreements related to net operating profits. If BTC.com records a net operating profit in the fiscal year ending December 2021, 500.com will have to issue additional shares to the Blockchain Alliance. Assuming that the minimum amount of the net operating profit is $20 million, a maximum of 22 million additional Class A ordinary shares can be issued.
In contrast, if the BTC.com mining pool business records a net operating loss during the same period, 500.com will be entitled to repurchase certain Class A ordinary shares held by the Blockchain Alliance.
500.com is a NYSE-listed company (WBAI) offering a range of online lottery services. The company has been moving into the crypto industry recently. In early February, 500.com purchased 5,900 Bitcoin mining devices at $8.5 million. In January, 500.com announced that its private placement subscription price will be settled both in the U.S. dollar and Bitcoin.
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