Argo Blockchain Mining Margin Shrinks to 20% as Natural Gas Prices Rise
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The factory uses power purchased on the spot market. Therefore, excessive energy costs have harmed profits this year. In January, the margin reached a peak of 74%; by July, it had decreased to 37%. The firm is attempting to negotiate a long-term, fixed-price power purchase deal to reduce its vulnerability to energy market volatility.
According to Argo,
"Spot power prices in West Texas averaged nearly $0.09 per kWh, which is nearly three times the average price during the month of August in prior years."
Observation Of Mining Expert
Wolfie Zhao, a mining expert, observed on Twitter that gross margins for several new mining equipments had decreased due to the market conditions. His estimates show that the Bitmain Antminer S19Pro and S19XP have fallen to 44% and 23%, respectively.
According to the release, Argo also agreed to host up to 10,000 mining equipment at 32 megawatts each. A percent of the net revenue generated by the use of those devices to mine Bitcoin will go to the London-based corporation. Mining companies can host their machinery at a facility controlled by another business if they don't own and maintain their infrastructure.
Reduction Of Computing Power Or Hashrate
While Argo has been putting in its miners at Helios since it launched in April, the company has lowered its projections for its hash rate, or processing power on the Bitcoin network, for the remainder of the year.
As of 8:49 UTC, the company's shares had increased 9.8% on the London Stock Exchange.
