RNS 25 Nov 2020 10:58
Argo, the leading cryptocurrency miner based in the UK (LSE:ARB), is pleased to announce it has successfully expanded the Company's mining capacity while simultaneously improving the Company's mining margins through lower hosting costs and generating an additional stream of revenue. Argo is pleased to have formed a solid relationship with Core Scientific as the Company's newest hosting partner and with Celsius Network as its financing partner.
Leasing Agreement
Argo has entered into an equipment lease with Celsius Network for 4,500 Bitmain Antminer S19 and S19 pro miners for a term of 24 months. Celsius Network is an innovative and fast-growing cryptocurrency lending platform which currently has over US$1.8 billion worth of assets under management.
Argo's lease, which spreads the new equipment cost over 24 monthly lease payments, allows Argo to add capacity, upgrade its mining technology and achieve economies of scale while fully retiring the capitalized cost of the miners over the term of the lease. The mining machines are valued at over US$10m.
The new mining hardware is expected to be fully operational by February 2021 and will add approximately 430 petahash to the Company's installed computing power as well as consuming approximately 15 megawatts ("MW") of electricity.
Hosting Agreement
Argo is also pleased to announce the machines will be hosted by Core Scientific which will provide physical hosting and access to electrical power for these newly leased machines at Core's existing facilities in the United States. Core Scientific is the largest digital asset mining infrastructure provider in North America and the partnership enables Argo to gain access to extremely competitive rates on hosting and power.
Mining Agreement
In addition to the purchase of machines to be leased to Argo, the Company has partnered with a third party which has purchased a new fleet of 4,378 miners to mine for its own account. These units will be delivered in February and March 2021. Argo and the third party have entered into a managed cryptocurrency mining services agreement whereby Argo will be managing the mining operations of these machines. This managed cryptocurrency mining services agreement will have an initial term of 24-months, and Argo will receive a monthly fee for these services.
Peter Wall, Chief Executive of Argo, said: "We are delighted to partner with Celsius and Core Scientific as we pursue our growth plans. These agreements allow us to secure very competitive terms on both new mining equipment and hosting costs. Argo continues to successfully expand its mining capacity while simultaneously improving mining margins and is in a strong position to benefit from the amelioration in market conditions."
Alex Mashinksy, CEO of Celsius, said: "We are excited to provide the financial backing and equipment to enable Argo to help secure the Bitcoin network. Mining is an
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