The Bitcoin mining industry is going through tough times as BTC’s price falters, but one mining outfit hopes to take advantage of the situation.
Nevada-based CleanSpark, which mines using a mix of nuclear, hydroelectric, solar, and wind power, acquired $5.9 million worth of mining equipment while others in the industry are struggling to stay afloat.
“This most recent purchase demonstrates how CleanSpark continues to execute in distressed markets,” CEO Zach Bradford told The Block. The price of miners has dropped tenfold since the peak of the bull market and Bitcoin’s price has fallen to less than a third of its peak of $68,789 a year ago.
While energy prices rise worldwide, Bradford said the company’s “unwavering focus” on clean energy has provided it with the means to “acquire machines at incredible prices, grow our hashrate, and increase our daily bitcoin production in anticipation of market conditions improving over the next several months.”
Last week, the company announced a 150% increase in its hash rate since January, and CleanSpark aims to mine 5.5 EH/s by the end of the year. The hash rate measures how much computational power a miner provides to the blockchain network. A rising hash rate likely means more BTC, which, if the price of BTC increases, could help the firm weather the economic turmoil.
While CleanSpark grows, other miners are shrinking. Bitcoin miner Core Scientific, a larger miner that contributes six times the hashrate of CleanSpark, risks bankruptcy if it does not raise enough money from investors. Bloomberg Law reported that bondholders have sought legal advice from whiteshoe law firm Paul Hastings in an attempt to protect their capital.
On Monday, Argo Blockchain, another miner, announced that it could soon go “cash flow negative”, something it said could prompt the company to shut down its miners. Wall Street did not take the news lightly, with two analysts downgrading Argo’s stock rating after shares fell by 41% on Monday.
And in court documents filed yesterday, bankrupt bitcoin mining hosting firm Compute North disclosed that one of its lenders, Lender Generate Capital, had acquired its $5m stake in two mining farms.