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Iris Energy Slashes Bitcoin Mining Capacity Due to a Requested Loan

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Australian cryptocurrency mining company Iris Energy, which operates a Canadian BTC mining site that runs primarily on renewable energy, recently closed mining operations at two of its subsidiaries.

Despite this, the company still claims the business continues to be profitable.

Immediate repayment of the requested loan

A subsidiary operating as a Special Purpose Vehicle (SPV) used a Bitmain mining rig funded by a $107.8 million loan from the New York Digital Investment Group (NYDIG). statementUnfortunately, the crypto winter has shattered the trust many investors had in cryptocurrencies, leading to demands for immediate repayment of loans.

Due to a combination of unfavorable market conditions, rising mining difficulty, rising electricity prices, and the declining value of BTC itself, the cryptocurrency miners in question saw a much lower return on investment than previously expected. .

Fortunately for Iris Energy, the machine purchased with the loan was also evaluated as collateral. In other words, the debt is eliminated simply by handing over to NYDIG.

Profitable business even if the stock price falls

Led by Daniel and Will Roberts, Iris Energy recently hit a market capitalization of $220 million as its stock fell 94.5%. Despite this, the brothers say they are still optimistic about the cryptocurrency sector.

they also repeated that their business model remains profitable despite the need for some adjustments; Currently, each bitcoin mined at their facility returns approximately $6,000 in profit.

That’s enough to keep the business running smoothly, but it’s not optimal considering the operating costs planned for better days.

“At a gross profit level, we’re clearly still profitable. We just need to figure out what level of overhead the business can support. just to do [SPV] Debt facilities by ring-fencing them. We are still very excited about this business and industry. “

The closure of two SPVs cut Iris’ mining capacity by more than half, losing 3.6 EH/s (exahash per second).

This leaves Iris with a total remaining mining capacity of 2.4 E/Hs. Fortunately, the company already sees some bright spots. Bitmain has already been paid $75 million to subcontract more mining rigs. Iris is currently in talks with Bitmain regarding the operation of these miners. This could increase Iris’ mining power by a whopping 7.5 E/Hs.

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