Member Info for HarChris

No completely disagree. There’s always a trade off, you sell down here and it might hurt but machines cost 90% less or you have to dilute at 90% lower share price - you lose one way or the other.

Riot now have options and don’t have to dilute at ever lower share prices, that without doubt is the number one thing to avoid now.

Nobody sold at the top so it’s pointless trying to compare based on that.

‘ Why did they sell 450 if they have hundreds of millions in cash ?’

This answers your question succinctly (he’s from Mara too ;) )

https://twitter.com/wsfoxley/status/1599824903095562240?s=46&t=AIKZ9KycARgdMJO0XMyRbA

Selling a portion of their mined Bitcoin is a sensible strategy rather than depleting their cash at this stage. Looks like they can still build their HODL (still selling less than they mine) and leave that huge cash pile free to expand as they wish over the next twelve months.

That cash pile can get them to 25EH/s+ easily and they have the facilities for it.

‘During Q1 2023, Riot anticipates a total self-mining hash rate capacity of 12.5 EH/s, assuming full deployment of approximately 115,450 Antminer ASICs, but excluding any potential incremental productivity gains from the Company’s utilization of 200 MW of immersion-cooling infrastructure.’

Got the cash sitting on hand for it + large HODL + free to issue as much as they want through their At The Market offering.

Number one miner

We're at the stage when each miner has a decision to make and I'll give you a few examples.

Hut8 either has to finally drop its HODL strategy or continue issuing shares at two year lows.
CLSK can probably just about stand still if they sell every coin they mine and pause expansion, otherwise they need to keep issuing shares at very close to two year lows
Bitfarms same as CLSK, possibly a little cash generation at $17k
Riot have $250m cash on hand so don't need to issue shares at close to two year lows but have that option available to them.
Mara will likely sell some of their large HODL before they issue more shares at close to 2 year lows.

All the above have At The Market placings in play but will want to avoid heavily diluting shareholders.

Most of the miners aren't close to switching off machines, only Corz and Argo, the difference now however is that finances are too tight to continue expanding without painful dilution. So what we'll see is non publicly listed miners coming offline and no expansion from the publicly listed miners to offset that hence further falls (but a steady and modest drop rather than capitulation).

Yes, ranked last out of the 'big 11' and only getting worse.

https://twitter.com/cazenove_uk/status/1591055324370313216

I think the CleanSpark ceo said their breakeven was ~$17k (it changes constantly based on difficulty and other factors).

Why is Argo's breakeven cash cost so much high higher? Well largely due to lack of ppa and far smaller operations and therefore less scale (bitfarms and cleanspark produce 2.5 - 3 times what Argo does now). If Argo had managed to reach 5.5EH/s by the end of the year like they targeted then they'd have brought down their breakeven cost significantly - but they achieved 2.5EH/s!

'There are a fair number of people who believe the bear market in Bitcoin will continue until after ( or shortly before) the next halving event which is scheduled to take place in 2024.'

And therein lies the inherent risk to Argo. Whilst many wish to bury their heads in the sand and be comforted by substanceless ramps the rest of us spend time trying to assess the investment case. Others talk of being confident in securing funding whilst failing to understand that the debt markets are totally off limits and raising the necessary equity is not possible with a £29m market cap. At most they will pull off a £5m raise and that gives them two months extra runway.

There are two outcomes - bitcoin bull market starts before ~ May 2023 and Argo survives or it doesn't and Argo doesn't. There's no third option involving funding to save Argo despite a prolonged bear market.

Of course V movements are not exactly aligned with the share price, we are invested in a company not the commodity itself. It is the biggest contributor to the share price though and if the rises are significant enough it would almost certainly be enough to outweigh every other factor combined...

But what's important to note is that it's (i) the trend that matters most and also (ii) the future expectation of vanadium price rather than today's price.

Your entire thesis is an optimistic guess.

'I’m expecting arb to have mined 250 btc this month, with a lot less electricity cost. People that think arb is going under (strategically) will be saying they never said that in 6 months lol. Do you hear me HC and Hexam?'

You are almost certainly going to be wrong on this prediction alongside every other prediction. How about if Argo's bitcoin mined is under 240 this month you admit that you don't know what you're talking about?

And no I've never said they are definitely going under... the problem is your comprehension skills are poor. Poor comprehension and poor investor. I've repeatedly stated why I think there's a high chance Argo fails and why it's therefore not worth the risk now... and if bitcoin turns I'll have plenty of opportunity to buy back in and make some profit without having risked blowing the lot.

Ssshh facts aren't important on this bb, hopium is what matters. Just look at the way some of the absolutely nonsense posts are being recommended.

At this stage though what matters is cash generation, not profit. Profit is kinda irrelevant as the losses were largely absorbed by the placees at £2 a share last year. Has your best guess at cash generation price changed now Galaxy debt is paid off? Yes I know there's still lots of unknowns but i'm just talking best guess.

Yes Blubay, we should have learnt by now that the big boys don't necessarily know what they are doing. Look at all the top hedgies buying the tech top in late 2021 and seeing 'considerable upside' at the time.

It wasn't long ago that we were seeing more and more funds buying Argo at 50p all the way down.

Unless bitcoin really rallies anyone buying now is at best getting spiked by a 5p placing.

It's not going to be possible to simply extricate bitcoin from alt coins, DeFi and the ponzis just like that. Besides the handful of bitcoin maxis almost everyone that promoted and supported bitcoin also promoted all these ponzi schemes, they supported the whole cryptospace from the lenders to the exchanges to the s*** coins. So now for the lay person there's very few people you can look up to and follow with any sort of belief and trust. And just because all of this is blowing up it doesn't mean the bitcoin maxis were right, it just means they were right about the space sans bitcoin - currently the gold advocates are sitting smugly as gold sits in the green over the past year whilst everything else is down 50%+

Of course over time that may change and this may well turn out to benefit bitcoin (as all new participants will focus on bitcoin rather wasting their time and money at the crypto casino) but it's very unlikely to see any sort of benefit in the short-medium term, over the next 3-6 months - and this is particularly relevant to Argo and why I suddenly went from seeing value in Argo as it fell to 8p to suddenly seeing no value at all and expecting the company to fail.

It matters to Argo WHEN bitcoin recovers, not just IF.

Would you mind explaining why? It can't be because of the bitcoin price. Friday bitcoin ranged between $16.9k and $17.1k and Argo ranged between 4.7 and 5.5. Bitcoin hasn't moved since.

You got some inside info?

It depends on what you mean by make it? Three or four of them have virtually no debt and still generate cash at $17k and even if bitcoin were to go to $12k then difficulty would have fallen off a cliff and they'd still be generating cash. So they make it with certainty. Those handful of miners *don't* have a problem (but may continue to fall as their assets are marked down further).

Then there's the next three or four that have considerable debt but with most of it being due 2024 onwards, they almost certainly make it but there are circumstances where they can get into trouble and of course if bitcoin stays deflated for years then they don't make those payments and eventually default in late 2024/2025.

And then there's the rest that are all at threat over the next two years.

Yesterday I listened to the cleanspark CEO Zachary Bradford talk about this very point. Everyone in the sector is fully aware that there is no appetite for crypto, bitcoin and the sector right now, they know that the price of rigs is falling and therefore they are largely holding off buying.

The machines are worth very little but Helios is obviously worth something, if I was to pluck a figure out of thin air I would say $70m all in today (Helios plus machines) but there are better people to answer this. You only have to look at the likes of CleanSpark that are valued at just $107m with 5.6EH/s already online and the facilities to grow that to 23EH/s.

The problem is that Helios is pretty much Argo's entire assets and to counteract that they have far more liabilities - if they were able to generate cash that would be okay, they'd ride out the difficult period and wait til the sector becomes attractive again and their assets are revalued upwards, but they can't. So every week that passes the finances get that little more stretched, the investment case weakens and they head that little closer to bankruptcy.

Something you clearly don't understand (and it's a common theme i'm noticing on these BBs) is the absolutely critical importance of share price for a company with no access to the debt markets and needing funding - share price is everything, you are worth what you can raise. The market now knows that Argo absolutely has to raise to survive and so there is no appetite to get caught out buying only for a placing discounted at 15% to one's entry, so the share price goes lower still.

I do understand why you think Argo is a bargain now but the reality is that in a nascent sector like this assets are marked down to almost nothing when the asset you mine falls like it has and unless you can make it to the upturn, to the next bull run, you aren't going to live to see the day when full potential is realised.

It absolutely did not have to fall below $20k and stay there, even if you personally predicted it. With bitcoin only dropping to say $28k and the space being in less disarray than it is it wouldn't have been hard to raise cash and they'd still be close to cash generation level. I would say all the miners were wary of a downturn as low as $25k for a period but there was widespread belief across the space that the cycles won't play out the same each time (they won't, it's just helpful to use the cycle theory now for making the case for another bull run and explaining away the lack of interest in the sector).