Member Info for Hexam

What - that's BEFORE the storm??

HC - Haha. Tricky as I'm not even on twitter, and have no wish to be as it's just full of crap like this. Anyway, I'm sure that there are plenty that can easily debunk this nonsense and quite frankly anybody that takes it at all seriously deserves what they get. Harsh, but I just get frustrated that so many people just believe what they want to see (and then promote it) rather than just do a tiny bit of digging themselves to see what is actually there.

The silly tornado discussion is actually a good example. I didn't know the answer so just looked it up. Northern Texas IS prone to tornados. Southern Texas IS NOT.

AB - that’s good to know as Northern Texas (including the panhandle) sits inside Tornado Alley.

https://en.m.wikipedia.org/wiki/Tornado_Alley

Depends on how much you include. Approximate current figures are:

Direct Mining (electricity) - $10k
Total Regular Cash Cost (including Interest) - $25k
Total All-In Cost (including depreciation) - $40k

May figures were around 20% higher than this but am assuming the very low number mined was a freakish one off.

Amounts should fall with Texas/growth but depends on many things - including how much difficulty increases.

And actually I don’t think ARB has any hosting costs now so for them it is just electricity.

Stnz - they only represent electricity costs, so the note on graph says, but no company reports this so I presume it is the direct costs of mining that they report. For ARB this is basically electricity plus hosting costs but even these are far higher than the $4k per BTC on the graph. In Q1 ARB themselves reported this at $9k and it will be higher now.

On top of this if looking at normal cash flow should then add other regular monthly cash costs (so not depreciation) but this hasn’t been done.

There are plenty of other things wrong but the getting the key figure of the analysis (operating cash flow) so wrong is enough on its own to invalidate the whole thing.

To be fair I think there are a lot of other reasons why it is shoddy (imo) but its being factually incorrect is more than enough on its own.

Whatever. Even Damien’s quoting that report in his video. The whole world’s gone mad. In my opinion.

Agree - I’m just saying it is possible to sell orders but yes, I can’t see Mara doing that with all their orders - without it being terminal. Just another example of why that report is so shoddy.

I wasn’t querying that part of your post but never mind.

FP - wouldn't it possible for one miner to sell on their order to another one for a cheaper price but they still pay the full price to the original vendor and take an immediate hit? Sounds crazy I know but if a company is desperate for cash and they can't simply cancel the order it may be the least worst option. It's sort of what Core Scientific did with ARB on the machine swap after all.

Limp - it is not 'in my opinion'. The numbers he has used are simply wrong (easy to check for anybody doing just a little bit of their own research) therefore any conclusion he reaches based on them is not reliable.

I completely agree that any opinion as to the future is completely that and I clearly stated that ARB may indeed be in a better position than some (or even most) of the other miners - but that cannot be drawn from this report.

But actual numbers are a matter of fact and he has got his wrong. In addition there also a lot of numbers quoted that can't possibly be known accurately (like remaining machine spend) but they are stated as if they are.

So I think it is a shoddy piece of work, and that is an opinion but I can justify it alone on the grounds that it is full of factual errors - or do you really believe the direct cost to mine per BTC for ARB is really under $4k? Even PW doesn't believe that.

"Even then I suppose we'll see distressed assets bought off cheap as well as new cash-rich entrants coming in and buying up ASICs on the cheap"

Agree HC - the most serious competitors for ARB could well be the ones we don't yet know about.

Got to be tempting for a major new player who believes long term in BTC to take advantage if this goes on much longer.

So Limp you're happy to believe a report based on total nonsense just because it agrees with your view? Funny how you didn't accept the equally laughable Boatman Report at face value.

HC - Unfortunately difficulty is not coming down quickly. Miners are losing money but they'll lose even more if they switch off their machines as they would only save electricity, hosting and maybe a little on top, rather than the all-in costs, and these costs are only around $10k-$15k for per BTC for most miners - or if you believe the ridiculous numbers in the 'Mellerud report', just $3k-$9k). A figure of just $3,933 per BTC is shown for example in the report for ARB - much lower even than the $9k claimed by PW!

I think they will all hang on until they hit problems with lenders as they run out of cash or something equally serious. Even then they'll have options (stop or sell orders, raise equity etc.). So it may be a few months yet until the first domino falls and in the meantime of course BTC could shoot up and we can all breathe a sigh of relief.

I repeat - this report is rubbish. The numbers and conclusions don't make sense. It's amatuer stuff.

If you hadn't noticed ARB is already liquidating BTC and is fast running out. It still may be in a relatively good position compared to some (or even most) but they are all suffering.

True - but something's gotta give. It must be in the accounts somewhere (as was dated March) and is too much to be all in non-current liabilities as they only total $23m (including some existing amounts)

One possibility is that they didn't actually take advantage of the whole loan but there is nothing to indicate this in the RNS that I can see.

Without more detailed info nothing is certain including that the Galaxy Loan is any higher than the $30m it was at year end.

*sorry, $58m not £58m

The first NYDIG loan was agreed in March as per RNS on March 10th:

"As part of the Financing Agreement, NYDIG has loaned Argo Helios an aggregate principal amount of $26.66 million (£20.23 million)"

Therefore it will have been included in the Q1 accounts and if all shown under current liabilities it is enough (virtually) to bring the total to £58m.

However, the loans under non-current liabilities also rose (from $4m to $23m) and I cannot explain the reason for this but there is nothing to suggest it is due to an increase in the Galaxy borrowings above the $30m included at year end (which would likely be shown under current liabilities anyway).

Rookie - What you posted was correct at the time but the plan was always to pay back some of that loan from money raised last year and presumably they did so as only $30m appears in the year end accounts and that I believe is the amount owed to Galaxy. As you say though it's unclear why the borrowing have gone up so much in Q1 (i.e. by more than the first NYDIG loan). The following is from the prospectus last year:

"On 9 September 2021, the Company entered into an additional $25 million term loan agreement with Galaxy Digital LLP (New Galaxy Term Loan) to finance the continued build out of its new cryptocurrency mining facility in Texas and other general corporate operations. The outstanding principal of the Galaxy Term Loan, in the amount of $20 million, was subsumed into the New Galaxy Term Loan, resulting in total borrowings of $45 million under the New Galaxy Term Loan. The New Galaxy Term Loan will mature on 29 October 2021 and the borrowing fee on the loan is 4.5% per annum...The New Galaxy Term Loan will terminate on 29 October 2021 or in certain other cases as specified in the agreement...The Company expects to repay £18 million ($25 million) of the principal of this loan with the proceeds of this offering and convert up to £14.5 million ($20 million) of the principal of this loan into mining machine financing upon receipt of machines and satisfaction of other conditions, with the repayment date for such financing extended beyond 29 October 2021 to a date to be agreed."