Member Info for HarChris

The standout tidbit is the US sales - 47% going to US (up from 34%) when we know prices have been elevated stateside.

You're sceptical about everything!

Not sure what it will do tomorrow calamari, trolls will try as hard as they can to paint the BE news as earth shattering but I consider it v. good news that production is on track and costs are being well managed - this almost certainly guarantees a return to profit in 2022 barring a steep drop off in V prices in H2.

'Since 2017, we have built an asset base with a net asset value of US$150 million, an achievement we are proud of as we started with a market capitalisation of US$20 million.'

Current mcap $103m - could someone see if they can find another company this far below NAV that is on track to post a profit in 2022? I'll send a tenner to anyone that manages it!

'Worse than expected' according to who? I never saw you share your predictions?

Personally they are *slightly* better than I was expecting but basically what I was expecting. More importantly 2022 guidance is unchanged, both production and costs... that was the biggest risk holding into these results.

He's the world's biggest bitcoin influencer, otherwise no one would know who the hell he was - how many CEOs of run-of-the-mill business service companies get this sort of publicity?

No bid is going to come in below 250p and even that is unlikely.

I've been vocal about my distrust of Saylor for well over a year now. What these influencers attempted to do, none more than Saylor but also Raoul and plenty of others, was create a supercycle by convincing enough people that that is what was coming. Everybody that followed them, including the public miners, will have gone all in on crypto but where the plan fell down is the lack of new entrants, most importantly institutions, that were also convinced and swept up in the hype.

Now with all the diehards overexposed and devoid of spare resources we see less of a rebound at the lows than we would otherwise.

I noticed this headline today on CoinDesk and thought it was telling 'MicroStrategy doubling down on Bitcoin buying amid Market Crash'

Actually they were able to increase their holding by 0.3%. This is probably true for all the maxis right now and the same goes for miners - this is the time to buy yet if anything there is more pressure to sell.

The next rebound occurs when new entrants with substantial capital enter the market, the likes of Saylor are now far less relevant.

Yes and a lot of it is out of Argo’s hands, the main factor is how long and how severe is the bear market going to be and the decisions made by mgmt now can either be prudent (like dumping all their BTC and holding off kitting out Helios to bolster the cash balance) or more risk taking (take on more debt in the hope bitcoin rallies soon).

We’ll soon start to see what sort of conviction these miners have.

I agree that we should be concerned with this drop Hexam. First of all there was real conviction about the supercycle, of institutional investment breaking the normal four year bitcoin cycle. Then as bitcoin fell and that theory was thrown out the narrative changed but lows of ~$25k were forecasted, instead it went considerably lower to $17k and still a few weeks on BTC is below $20k and threatening to retest that $17k mark.

I regret recently buying some Corz and Riot as there's a very real chance of a long drawn out downturn now that causes long term damage - I'm just hoping for a deadcat bounce to get out with some profit or a tiny loss although am tempted to take the hit now and sit out the next month and wait to see what moves the miners make next.

I think we're broadly in agreement. You then went on to say this:

'Of course even if ARB fall into a position where it looks like they won't have the funds to repay debts or post the necessary collateral they will have various options to try to deal with this (re-financing, equity raise etc.).'

I suppose I should have said very, very slim chance of bankruptcy rather than literally no threat but other than that we agree - bankruptcy is not the concern right now, it's surviving the bear market in one piece so as to see a share price recovery on the flip side .

I agree but it's been below $25k for just two weeks, all feels a bit premature.

Talk of Argo going under is scaremongering Chae, whilst times are obviously bleak for all miners there is literally no threat of bankruptcy for Argo for the considerable future. BTC would need to stay below $19k (and probably go even lower) for a substantially long period for there to be any threat to argo's existence.

What's actually important is if, in the likely event BTC recovers and another bull run ensues, Argo will be in a position to take advantage of it.. Will there be HODL to sell at $50k, at $60k, at $100k etc ? Will there be a bigger debt pile to service at high interest rates taking on during the bear market? Will the market get carried away with itself like in early 2021 or has the business model been found out?

The next three to six months will determine whether Argo ends up 50p a share on the flip side or £3+

A bit silly but made me laugh out loud :D

https://twitter.com/packyM/status/1542127834533167106

I think it's worth noting that there isn't likely to be many new entrants in the short to medium term. Even with rigs dropping in price it will be near to impossible to raise equity at this point in time and any entity that is cash rich is more likely to just start buying BTC direct than go out and built themselves a large mining operation.

If any big miners go to the wall then yes that's different, the steeply discounted machines would then make it worthwhile or we could even see miners bought up on the cheap.

Yeah my point is they aren't losing more because they are mining more (i.e better to switch off machines), it's simply that they've got too big too quickly and have been caught out by the lower than expected bitcoin price (~$25k-$30k trading range would have been far more manageable). In other words the spotty kid mining 0.01BTC in his bedroom is losing the least of all.

But as long as most of the liabilities are long term, 2024 onwards, then there is still plenty of time for bitcoin to pick up before those companies get into serious trouble.

How is that the case Chaebol? I get that none are making a profit at this level but if the machines have been paid for, the land has been paid for and all the work to get the operation to full whack why would mining more cost more? I'm confident Corz' costs discounting all the sunk costs wouldn't be more than $20k a bitcoin / $24m a month.

The issue is all the debt accumulated to get those mega-sized operations and in particular short term repayments that have to be met.

Argo is certainly getting off lighter at the moment than many of the miners, it's lack of operational growth is now seen as a plus point and with cheap enough energy to outlast some of its peers.

For example Core Scientific is valued just 2.5 times Argo now and then you compare BTC mined...
Argo mined 124 BTC in May, Corz mined 124 over the last three days!

Whilst I was obviously taking the mickey it does at least put to bed the rumours of MSTR margin calls around $20k.