Member Info for HarChris

If you think AB is subtly deramping then you've lost the plot.

Argo is in a precarious position with a number of scenarios possible.
(i) Bitcoin remains depressed (well below profitable levels) but the placing comes through, survival guaranteed over the short-medium term and live to fight another day, SP capable of recovering close to 27p.

(ii) Bitcoin remains depressed, placing renegotiated at a lower price giving more equity to new investors/new funding sorted, again survival guaranteed over the short-medium term and live to fight another day, SP closer to 19p for the foreseeable

(iii) Bitcoin remains depressed, placing falls through and no funding is found - administration.

(iv) Bitcoin starts recovering, the placing goes through and Argo is reasonably well placed to expand a little with the share price recovering ~50p, obviously higher if bitcoin rips

(v) Placing falls through but bitcoin goes on a tear, Argo survives on the $5.7m and $6.8m and raises at ~55p on the way back up - set up to potentially compete in the next bull market.

I'm going for option (vi), bitcoin spikes over the coming weeks with other miners taking advantage through large diltive placings. Turns out to be nothing but a relief rally but miners across the board use the funds to continue expanding once again, hash rate rips and further pressure is piled on miners in two to three months time.

Well a lot of work has gone into rebuilding the infrastructure in Madagascar to not only get operations back up and running but to weather proof them for the inevitable storms ahead. This sort of forward thinking should put Tirupati in good stead.

Not to mention the looming graphite shortage. Yes I know it's been talked about for yonks but Chinese shutdowns are starting to show cracks and EV manufacturing is going through the roof:

https://www.benchmarkminerals.com/membership/graphite-inventories-in-china-shrink-ahead-of-winter-shutdowns/
https://twitter.com/skorusARK/status/1586023669700079616

I think we're about to see an interesting set up play out. My money's on a decent Bitcoin spike over the coming weeks which will either turn out to be a genuine reversal and a new bull market or a bear trap relief rally. I'm intrigued to see if any miners move early and gamble on the latter, attempting to get a placing away with their share price double what it was last week (assuming a sustained rally).

If any miner does get a decent sized placing away in November only for bitcoin to fall back they will be armed with a war chest to go after rock bottom priced machines and to pick the bones from the likes of Core Scientific when they inevitably fold.

I'm sure you love Saylor for very reasons that will very possibly destroy bitcoin (/ wound it at the very least), an unwavering commitment to the HODL strategy. There's a very real chance the next bull run comes and MSTR stick to their guns and continue buying bitcoin, putting more of their enormous BTC holdings up for collateral and significantly adding to their debt. Problem is, this time the bear market may well coincide with their debt obligations and all of a sudden MSTR become a distressed seller of 150K BTC.

Having said that MS isn't CEO anymore so that might be their excuse for acting more risk averse when the time comes and they sell during the next bull run.

You might have a point there Stnz. MSTR do have $2.4B debt that needs to be repaid in 2025 but there’s a whole bull run to be had before then so if you don’t trust Saylor to navigate through that bull run successfully (which I don’t) you can sell after you’ve bagged a few times.

With difficulty as high as it is they need far more than $25k BTC, I would vouch none are profitable at $30K, probably none at $35K either, some at $40K and the rest closer to $45K.

Of course this will change as some miners go bankrupt or are forced to switch off their machines, bringing down difficulty for the rest. On top of that any additional hash expansion now will come at a tenth of the cost of what it did at the peak last year as rigs continue to plummet in price.

I was enjoying thinking about the buyback hypotheticals to highlight how stupid the market cap is.

What about novacyt buys back 50 million shares for £38m? Leaves £61m cash in the bank and 20.6m shares in issue. Market cap would be about £35m and share price therefore £1.70 . With such a tiny float any good news and share price explodes.

Just playing around - realistically they could attempt to buy themselves out and go private.

You read correctly. Up in Europe, US and China

I'm afraid that's wrong as the company have been sharing the prices with us in their quarterlies. Q2 US averaged $67.5/kg (the Ukraine war spike) and Q3 averaged $50.9/kg. Now compare and contrast with investing.com and you'll see it's wrong, its not what the company say they've been seeing.

It has fallen but is still $44/kg so healthy margin, fingers crossed it goes no lower.

The share buyback is a signal to the market that a) the shares are stupidly cheap and b) we have oodles of cash and are able to spend it (not tied up in dispute). But yeah time it around some positive news and the share price will be above a pound in a flash and potentially a new floor to push on from.

Spending £10m on shares as cheap as this to spark some interest and bring attention back to the company is money well spent.

I'm very anti buybacks but this is a rare situation that is absolutely crying out for it, I mean technically they can afford to buy back 100% of shares and some right now, that is unheard of!

F*** being conservative in case we lose the dispute, they've told us they have strong grounds to assert their contractual rights. We know we're months away from a meaningful turnaround revenue-wise so why not throw us a bone and show some fight for shareholders for once?

Just announce you're initiating a buyback, no need to actually buy back more than about 5% but the announcement alone will wake the market up.

What I suspect will happen over the next six months is a number of miners will go to the wall (Core most notably, maybe another or two) and their assets will be flogged on the cheap meaning all that additional hash for whichever miners get their hands on it will be instantly cash generative.

It will be that that swings the pendulum as much as bitcoin itself rising.

Wouldn't it be best to do the research 'before' diving in rather than after? Seems pretty reckless to me.

Very simple reason... depreciation of machines. It's such a big factor in this sector that any metric not including it is rather unhelpful and misleading.

Yeah I came to the conclusion a few months ago that Corz and Argo looked the most distressed. Argo didn't fall anywhere near as much as it looks like Corz is about to but interestingly as the days Argo dropped by a similar amount (35p to 11p).

I don't think there's any other publicly listed miners close to collapse like we've seen with the above - probably need 4 or 5 months more $20K BTC for any cracks to show elsewhere.

For all those perhaps including me in the deramping / attempting to spread fear. accusations... no, not at all.

This is good for the space.

To be fair Hexam I think Corz are in significantly worse a position than Argo but for different reasons. They expanded so hard and so fast through arguably very agile management. I'm sure last year many miners looked on at Core Scientific with envy...

Then the market turned harder and faster than almost anyone imagined and suddenly it made no difference that they had cornered 5% of the entire global hash, they simply had too much debt to be able to survive.

Down 75% pre market, I'm not sure there's a way out of it for them.

https://www.coindesk.com/business/2022/10/27/core-scientific-to-suspend-payments-as-cash-dwindles/

34% down pre market - Chaebol I did say we'd see the cracks appear within three months, can I take the win on this one?!

Sold far too soon, drat.

Good luck to all the holders, moving fast!

Alfredh, it is really time to drop the Vametco rubbish. What's in the past is in the past, it is delivering this year's stated guidance and it is clear from the 4 stage plan that it is no longer the priority. Vanchem (in which we own 100%) is the priority and will eventually be producing considerably bigger output than Vametco.

Agree about the CLN but we aren't likely to fall more than $10-$15m short, perhaps it will be as simple as offering them shares at some agreed price next year (something between the 17p CLN conversion price and today's ugly 4.5p)