Canaan Inc. (NASDAQ: CAN), the Singapore-based designer and manufacturer of Avalon Bitcoin mining machines, has spent much of the post-2024 halving period playing catch-up to dominant rival Bitmain. However, recent developments – including a landmark 50,000-unit order for its Avalon A15 Pro series and the imminent launch of the efficiency-leading Avalon A16 series – signal that Canaan is rapidly closing the performance gap at precisely the moment when U.S. and institutional miners are aggressively expanding capacity.
On November 12, 2025, Canaan released its October mining update, showing steady progress in self-mining operations (deployed hashrate of 9.31 EH/s, 92 BTC mined) and highlighting new initiatives such as a gas-to-computing pilot in Canada. While these operational improvements are encouraging, they are symptomatic of a broader and more important shift: Canaan’s hardware is once again competitive with – and in some cases superior to – Bitmain’s flagship offerings. This technological re-convergence, combined with strong order flow from North American miners, provides the foundation for a forward-looking thesis that Canaan is poised to regain meaningful market share in the ASIC supply chain during the 2026–2027 bull market phase.
Investment Thesis: Canaan Inc. will capture 18–25% of new Bitcoin mining hardware demand in 2026–2027 (up from an estimated <10% in 2024–2025) as its latest-generation Avalon A15 Pro and A16 series achieve parity or better efficiency than Bitmain’s Antminer S21 lineup, driving a re-rating of the stock toward 2–3× current enterprise value / expected 2026 mining revenue multiples seen in prior cycles for vertically integrated miners/manufacturers.
Why Hardware Efficiency Parity Changes Everything
The Bitcoin mining equipment market is brutally winner-take-most. Post-halving, miners prioritize joules-per-terahash (J/TH) above all else because lower efficiency directly erodes margins when block rewards are cut in half. From 2022–mid-2025, Bitmain’s Antminer S21 series (17.5 J/TH air-cooled, down to ~13 J/TH hydro) dominated new deployments, relegating Canaan to a distant second place.
That dynamic is reversing:
- Canaan’s newly launched Avalon A16 series delivers 12.8 J/TH air-cooled performance – matching or beating Bitmain’s best air-cooled S21 variants.1
- The A16XP flagship reaches 300 TH/s at 12.8 J/TH, putting it in direct competition with Bitmain’s high-end hydro models while remaining air-cooled and easier to deploy at scale.1
- October’s 50,000-unit A15 Pro order – the largest in three years – and repeat purchases from CleanSpark, HIVE, and others demonstrate that miners now view Avalon machines as viable, cost-effective alternatives.2
Historical precedent supports the magnitude of this shift. During the 2020–2021 cycle, MicroBT’s WhatsMiner series gained share rapidly after closing the efficiency gap with Bitmain, helping push its manufacturer valuation dramatically higher during the bull run. Canaan, as one of only three meaningful ASIC producers (alongside Bitmain and MicroBT), is now positioned for a similar swing.
Quantitative Support: Order Momentum and Valuation Upside
The October 50,000-unit order alone represents roughly 10 EH/s of new hashrate (assuming ~200 TH/s per A15 Pro unit) heading into U.S. fleets in Q4 2025–Q1 2026. At current ASPs of ~$16–20/TH, this single contract is worth $160–200 million in revenue – a material portion of Canaan’s expected FY2025 total.
More importantly, it serves as a leading indicator. Public miners (MARA, RIOT, CLSK, etc.) are currently in full expansion mode, targeting 50–100% hashrate growth into 2026 to front-run rising network difficulty and position for the expected Bitcoin price appreciation cycle. With Canaan’s hardware now efficiency-competitive and often cheaper on a dollar-per-terahash basis, the company is well-placed to secure 18–25% of the estimated 150–200 EH/s of net new public-miner capacity expected in 2026.3
At a conservative $16/TH ASP, 25–40 EH/s of Avalon shipments in 2026 would generate $400–640 million in hardware revenue alone, plus growing contribution from Canaan’s own ~15 EH/s self-mining fleet (targeted for mid-2026). Trading at ~0.8× EV/2026 hardware revenue today, a re-rating to even 2× (in-line with peak-cycle multiples for mining-exposed names) implies substantial upside.
Competitive Positioning and Historical Analogues
Unlike pure-play hosting miners that pivoted aggressively to AI/HPC in 2024–2025 (Core Scientific, Hut 8), Canaan remains almost entirely focused on Bitcoin ecosystem vertical integration: ASIC design → machine sales → self-mining → BTC treasury (1,610 BTC as of October 2025). This purity resonated in the 2020–2021 cycle when MicroBT and early Canaan both captured swings in market share as efficiency leadership rotated.
Today, public miners control ~32% of global hashrate (up from ~22% a year ago) and are consolidating purchasing power.4 With U.S.-based fleets prioritizing domestic or allied-nation supply chains amid ongoing trade tensions, Canaan’s expanding North American manufacturing and deployment footprint provides a meaningful differentiator versus Bitmain.
Risks and Counterarguments
Execution risk remains high. Canaan must deliver the A16 series on time and at advertised efficiency; any delay or underperformance would cede ground back to Bitmain.
Geopolitical/trade risk: Potential escalation of U.S.–China tariffs on ASIC imports could disrupt pricing advantages.
Bitcoin price dependency: A prolonged bear market or failure of institutional adoption to push BTC materially higher in 2026 would compress miner capex and delay fleet upgrades.
Competition intensity: Bitmain is not standing still; new S23 or hydro models could re-widen the gap.
These risks are real, but mitigated by (1) Canaan’s proven ability to iterate quickly (A14 → A15 → A16 in <24 months), (2) diversified manufacturing footprint, and (3) the structural tailwind of post-halving efficiency optimization cycles that historically reward the “second mover” who matches the leader at lower cost.
Sector and Macro Context
The 2024 halving initially pressured margins, but Bitcoin’s subsequent recovery above $100,000 and projected institutional inflows (spot ETF AUM already >$150 billion) set the stage for the strongest miner capex cycle since 2021.5 Miners that locked in low-cost power and secured next-gen hardware earliest will compound advantages as difficulty rises.
Canaan sits at the nexus of hardware supply and self-mining exposure, uniquely levered to this dynamic without the AI/HPC dilution seen in many peers.
Conclusion: What Investors Should Watch
Canaan Inc. offers asymmetric exposure to the next leg of Bitcoin mining consolidation. Key upcoming catalysts include A16 series shipping confirmations, Q4/Q1 order follow-through, and self-mining hashrate milestones toward the 15 EH/s global target.
If Canaan sustains hardware momentum and Bitcoin continues its institutional adoption trajectory (consensus 2026 price targets $140,000–$200,000+ in bull cases), the stock’s current depressed valuation leaves substantial room for multiple expansion.
This article is for informational purposes only and does not constitute investment advice. Investing in cryptocurrencies and related equities involves substantial risk of loss. Readers should conduct their own due diligence and consult qualified advisors before making investment decisions.
