Cango Sells $305M Bitcoin to Fund AI Expansion, Repays Loan

The weekend sale by publicly traded Cango (CANG) represents a significant liquidation of its primary asset. The firm stated it used all $305 million in proceeds to repay a portion of a Bitcoin-collateralized loan, a move explicitly aimed at cleaning its balance sheet. This financial maneuvering provides the capital and flexibility to pursue what CEO Paul Yu calls a “strategic pivot.” The company plans to leverage its existing, globally distributed infrastructure—over 40 sites across four geographic regions—to provide distributed compute capacity for the booming artificial intelligence industry.

This is not an isolated divestment but part of a broader tactical shift. In January alone, Cango mined nearly 500 BTC and sold 550 BTC for about $39 million. CEO Paul Yu had already telegraphed future sales, stating, “Starting this month, we will selectively sell a portion of newly mined Bitcoin to support the expansion of our inference platform and other near-term growth initiatives.” This approach is designed to fund the AI expansion while managing liquidity, leaving the company with 7,474.6 BTC, valued at roughly $528 million, at the end of January.

The market’s immediate response to Cango’s announcement was negative, with shares falling nearly 3% to trade below $0.95. This decline extends a brutal six-month trend that has seen CANG’s stock price plummet by 62%. The sell-off reflects investor skepticism about the capital-intensive pivot and the dilution of its core Bitcoin-centric business model. The news outlet Decrypt noted the share price movement, though a company representative did not immediately respond to its request for comment on the market reaction.

Cango’s move occurs within a sector actively exploring diversification. Other publicly traded miners, like Bitfarms, have signaled a more complete departure from mining. Cango, however, is attempting a dual-track strategy. The firm asserts, “Cango remains committed to its mining operations, with a continued focus on enhancing mining economics and seeking an optimal balance between hashrate scale and operational efficiency.” It promises a “disciplined framework for asset allocation” to navigate both the crypto mining and AI compute markets, which have vastly different economic and operational profiles.

To spearhead its foray into AI, Cango has brought in executive talent from outside the crypto sphere, appointing Jack Jin, formerly of video conferencing giant Zoom, as its new Chief Technology Officer. His mandate is to build out the AI business line from the ground up, leveraging the company’s distributed data center assets. This hiring underscores the seriousness of Cango’s pivot and the technical demands of competing in the high-stakes AI infrastructure market.

The strategic shift unfolds against a backdrop of significant volatility in Cango’s primary asset. At the time of the sale, Bitcoin was trading around $70,727, down nearly 10% over the previous week. The top cryptocurrency remains 44% below its October all-time high of $126,080, despite a partial recovery from a dip toward $60,000 last week. This environment of price fluctuation and compressed mining margins is a key driver for miners like Cango to seek more stable, high-demand compute applications like AI, using their Bitcoin reserves as a war chest to fund the transition.