The latest Investing Matters Podcast episode featuring Jeremy Skillington, CEO of Poolbeg Pharma has just been released. Listen here.
First Spot Bitcoin ETF decision by SEC due by 14th Nov (this Sunday):
https://www.fxstreet.com/cryptocurrencies/news/bitcoin-spot-etf-approval-expected-to-trigger-another-btc-price-rally-202111111053
Headline hashrates, for Argo:
Was 0.645 TH/s at end of 2020.
Is currently roughly 1 TH/s, and will be 1.7 TH/s at this year end, 2021. (2.6 x that of 2020.)
Will be at least 3.7 TH/s, using 200MW in 2022. (2.2 x that of 2021.).
After that could be using 800MW, so (3.7 + (3x2)) = 9.7 TH/s.
Just remember that Mining Difficulty, roughly on average, doubles every year, so if ANY MINER are not doubling their hashrate they are mining less coins, (and that ignores halving).
Argo have plans and infrastructure and space to keep up with the required doubling and so improve their ability to mine more BTC coins.
A good question to ask is - "Do other existing miners have this plan and ability?"!
Of course ALL MINERS have to pay for mining machines too, but that is the same issue for every miner.
If Argo can find a way to get mining machines for less and use the power and mine at the required hashrate (second hand units in immersion cooling), then that is brilliant, providing there is space at no cost, which Argo have (and most others do not). This looks like being lot more cost effective: Around 1/3 the cost per mining machine giving 2/3 the hashrate with immersion (aka 2 for 1).
Footnote 1: Argo will mine well over 200 BTC coins per month before year end, and into the new year.
I reckon will be around 178 BTC equivalent mined, and that giving an Income of 7.4m GBP.
(based on PW’s Q3 briefing on Hashpower, Mining Difficulty, BTC price, days in month, and exchange rate).
Any other views/expectations?
Part 3 of 3: Follow up info. on 100m USD Credit Facility (to my posts at 11:28am this morning and a minute ago).
What this all amounts to is:
In February, we voted to raise and spend money for the purpose of 320 acres in Texas which would also gain us a 100mUSD Credit facility to build out and add miners.
In April, we were told we had acquired the 320 acres in the Full Year results, post balance sheet events.
In August, we were told we have 160 acres in Texas, and no mention - positive or negative about the 100mUSD Credit facility in the Interim Half Year Results 2021, stated as a footnote in the Interim Management Report.
In September, we we were told again we have 160 acres in Texas, and an option to purchase 157 acres based on issuing more shares if milestones are met. Again here, no mention - positive or negative about the 100mUSD Credit facility.
To me, this does not seem “transparent” at all:
1. Not clearly or timely communicated, and money raised possibly not used as voted for - less land, less miners, and a still unknown and not communicated status on associated 100m USD credit facility. Again we must assume it still exists as it has not been RNSd otherwise.
2. Also plain wrong in the communicated RNS of the 2020 Full year results, as we had not actually bought 320 acres at all!
Part 2 of 3: Follow up info. on 100m USD Credit Facility (to my post at 11:28am this morning) beyond 8th March…
A. RNS of 29th April “2020 Full Year Results
” , stated:
“Post balance sheet events
? All mining machines currently mining have achieved over 100% ROI*, including those installed in January and February of 2021
? Acquired 320 acres of land in west Texas for a total consideration of US$17.5m with access to some of the lowest-cost clean electricity to support a hosting facility project as part of the next phase of smart growth in 2022”
B. RNS of 9th August “Interim Half Year Results 2021”, stated, in a footnote,:
… “Interim Management Report” …
“In the first quarter, the Group conducted two fundraisings which together generated £49.2m in new equity. These fundraisings enabled the Group to invest in new machines and fund working capital requirements as well as a strategic investment in Pluto Digital PLC ("Pluto") and an acquisition of DPN LLC to acquire the Helios project and land in West Texas, as described below. The Group has been able to grow its crypto holding to 1,268 Bitcoin and equivalents at the end of June 2021 as a result of the cash generated from these placements and the monies collected from options and warrants exercises, which helped to fund working capital.
In March, the Group acquired the Helios project - 160 acres of land in West Texas primed for the development of a cryptocurrency data centre - through the acquisition of DPN LLC. The land has access to up to 800 megawatts (MW) of power, primarily from renewable sources. Post period end, the Group has broken ground at this facility and expects the first stage of this development, a 200MW Facility, to be completed in the first half of 2022.”
…. “Outlook”….“In March 2021, we acquired 160 acres of land in west Texas, where we are building a new hosting facility with up to 200MW of clean energy at low prices, which will give us the capacity to establish our flagship mining centre in the United States by the first quarter of 2022 and access to up to a further 600MW of power for future development.”
C. Prospectus of 23rd September, stated:
* “12.4 DPN Agreement and Plan of Merger ?In March 2021, the Company acquired DPN LLC (by way of a merger with the Company’s wholly owned subsidiary, Argo Innovation Facilities (US) Inc.) pursuant to which the Company acquired 160 acres of land in western Texas, along with an option to purchase an adjacent 157 acre parcel. The consideration for the acquisition was an initial payment of approximately 3.5 million Ordinary Shares, valued at $5 million. The Company also agreed to pay up to an additional approximately 8.8 million Ordinary Shares, valued at $12.5 million, payable if certain contractual milestones related to the facility are fulfilled. “
….
* “17. Premises
The Group has acquired 160 acres of land in western Texas, with an option to purchase an adjacent 157 acres of land"
Part 3
The 100m USD Credit Facility:
A. RNS of 10th Feb “LOI Signing”, stated:
“As part of this project, Argo will also gain access to a pre-negotiated US$100 million credit facility at competitive rates. This will provide Argo with sufficient debt capital to build out the facility and further expand its mining fleet to upscale the Company's operations and capacity. “
B. RNS of 17th Feb, “Notice of General Meeting and Circular”, stated:
“The GM Notice and Circular contains resolutions to approve the issuance of new shares, which will be put to shareholders at a General Meeting of the Company, to be held at 10:00 am on 5th March 2021.
A copy of the GM Notice and Circular will shortly be submitted to the National Storage Mechanism”
C. From the national Storage Mechanism, dated 17th Feb, “2 Resolutions) Directors authority to allot a further 17.25m Ordinary shares and waiver of pre-emption rights in connection with the allotment.”, Stated
“2. Resolutions
The Company has entered into a letter of intent to acquire certain lands in West Texas, USA along with agreements for the electrical interconnection and construction of a new mining facility with up to 200mw of electrical power. As announced, the acquisition is subject to the entry into a definitive agreement and satisfaction of certain conditions. The Company will satisfy the consideration payable for the acquisition in shares. As a result, the Company is seeking an additional share authority to enable it to issue these shares in due course. In addition, the directors are seeking this authority to enable the issue of further new shares to raise the additional capital necessary, among other things, to pay a deposit to unlock a US$100m credit facility available in connection with the acquisition. “
D. All Resolutions were voted on and passed at the meeting of 5th March
E. RNS of 8th March, “Purchase of Land and Power Generation Rights”. Stated:
“Argo Blockchain, a global leader in cryptocurrency mining (LSE: ARB), is pleased to provide a further update to its previously announced non-binding Letter of Intent with DPN LLC of New York, which set out the terms for Argo to acquire 320 acres of land in West Texas, USA. The Company has now completed the acquisition of DPN LLC and as a result, has acquired the land.”
This RNS contained no information to say the 100m USD credit facility was not included.
So, we would have to have an RNS to change this. We have not had an RNS to change this.
To me, this simply means we must still have a US$100m credit facility - a “pre-negotiated US$100 million credit facility at competitive rates”
Any views?
I see the October Operational update as standard news (given we had the September) which will obviously come in teh next few days.
So separately, why are we now waiting for PW to say things he couldn't say in the Quiet Period?
He is a communicator. Where is the communication? Does he have anything to say? - Yet, all of his communication channels are silent...
Quiet period ended yesterday.
US exchange opens in half an hour (1:30pm UK time) so, whether we view the date as UK and/or US constrained, if there is going to be anything said that couldn't be said already then there's no reason why we shouldn't be hearing it and loudly in 30 mins time.
Mr Peter Wall, the floor and all communication channels are yours, and I and sure we are all very much look forward to hearing from you....
FWIW based on the info from today's briefing, relative days in month, currency strengths, hash rates and BTC prices, I am reckoning on the forthcoming October operational update showing around 178 BTC equivalent mined, and that giving an Income of 7.4m GBP.
Rhodium: Liquid cooling for 4 years - trials and ready to scale up.
Snippets from Rhodium’s SEC filing:
“will be one of the largest liquid-cooled bitcoin mining sites in the world, with 100 megawatts (“MW”) of liquid-cooled miners scheduled to be online by December 2021.”
“we have agreed to pay a percentage of profits to our electricity provider in addition to the fixed costs.”
“For the period from July 1, 2021 to September 30, 2021, our average electricity cost to produce one bitcoin was approximately $2,145”
“We generated revenue, net income and Adjusted EBITDA of $48.2 million, $14.9 million and $40.9 million, respectively, during the six months ended June 30, 2021. “
SEC filing is here:
https://www.sec.gov/Archives/edgar/data/0001874985/000121390021055212/fs12021_rhodium.htm
The profit sharing with power supply is interesting, and unclear on the splits too.
https://cointelegraph.com/news/telsa-hints-it-may-soon-resume-support-for-crypto-payments
Core Scientific's analyst presentation of 19th Oct is below. For those who are keen to see what BIG currently looks like.
https://www.sec.gov/Archives/edgar/data/1839341/000119312521302332/d232954d425.htm
Wow!, that really shows the scale of appetite of investors, for "branded" BTC exposure in more convenient and more widely understood and accessible forms, ETFs, PayPal, etc.
Also, I am thinking the key catalyst for propelling BTC's bull-run could be as simple as the widespread rising news of Inflation, with Interest rate rises on the cards too, people will be looking for options...
If we’re looking to understand how ARB sp is doing/does vs comparable market player I can only see MARA as a good benchmark. It made its ATH at roughly same time as BTC and seems to move up and down well with BTC now (after it’s rapid re-rate a few weeks ago).
Any views?
Anyone else got another good, or better “yardstick” for us to look at ?