Over the past 24 hours, Bitcoin Cash recorded a 20 percent surge in its price as the best performing cryptocurrency in the global market.

Within merely hours, the price of BCH increased from $440 to $540, by more than 25 percent at one point. Analysts have attributed the price increase of BCH on September 27 to the successful initial public offering (IPO) filing of Bitmain with the Stock Exchange of Hong Kong Limited.

Bitcoin Cash 1-hour price chart provided by Cryptowat.ch

Why Bitmain IPO is the Main Factor

In early August, a Bitmain investor deck was leaked to the public by an insider within the company. The document detailed the holdings of Bitmain in various cryptocurrencies including Ethereum, Bitcoin and Bitcoin Cash.

The deck disclosed that Bitmain has held more than 1 million Bitcoin Cash since late December, accounting for nearly 6 percent of the entire circulating supply of the cryptocurrency. At the time, cryptocurrency analyst Cobra stated:

“Bitmain holding 1M+ BCH is a very powerful statement that they have skin in the game and put their money where their mouth is. It’s a good and calculated move, and it’s not wise to underestimate them.”

However, the 1 million BCH holdings of Bitmain triggered controversy in the cryptocurrency sector as investors started to attribute the IPO of Bitmain as a way to liquidate its holdings of Bitcoin Cash, even though it only represents about $540 million, which is less than 50 percent of the company’s quarterly profit of $1.1 billion.

Eventually, investors in Bitcoin Cash started to speculate on the IPO of Bitmain and whether the conglomerate will be able to successfully conduct the public offering of its equity.

On September 26, Bitmain officially released its IPO document filed with the Stock Exchange of Hong Kong Limited, which almost immediately led to the increase in the price of Bitcoin Cash.

eToro senior market analyst Mati Greenspan told Forbes:

“This spike was definitely caused by Bitmain’s IPO filing,” adding that the timing of the filing was impeccable.

The document also revealed a healthy balance sheet of the company, which emphasized an impressive 74.5 percent market share over the cryptocurrency mining equipment manufacturing sector and a staggering 328.2 percent yearly revenue growth since 2015.

“We have experienced exponential growth during the Track Record Period. Our revenue increased from US$137.3 million in 2015 to US$2,517.7 million in 2017, representing a CAGR of 328.2%, and increased by 936.6% from US$274.5 million for the six months ended June 30, 2017 to US$2,845.5 million for the six months ended June 30, 2018,” the document read.

Rise in Confidence From Investors

Marouane Garcon, managing director of crypto-to-crypto derivatives platform Amulet, added that the large holdings of BCH by Bitmain likely increased the confidence of investors towards the asset.

“It has been no secret that Bitmain holds massive amounts of BCH, but now that they are going public they are going to fill their already immense treasure chest with more money, and I’m confident a good chunk of it will go towards the development of BCH. Exciting times ahead for Roger and Jihan,” Garon said.