Bitcoin miner Argo Blockchain is slowing down growth for the remainder of the year.
The company plans to reach a hash rate of 3.2 exahash per second (EH/s) by the end of 2022, it said Wednesday. That's 41.8% down from what it had announced with its first-quarter results. Its hashrate was 2.2 EH/s at the end of July.
The change reflects current expectations for the delivery and deployment of the custom machines using Intel's Blockscale ASIC chips, Argo CEO Peter Wall said in a filing with the US Securities and Exchange Commission.
"We have worked closely with ePIC and Intel to modify the machine design to increase total mining efficiency, which has delayed our expected deployment schedule," Wall said. "Further, we are preserving our optionality by reducing our overall capital spending on these machines as market conditions remain volatile."
The company is still on track to complete the installation of its order of 20,000 S19 J Pro machines from Bitmain by October of this year. It completed the first phase of development at its Helios site, in Texas, at the beginning of May.
During the first half of 2022, Argo reported a pre-tax loss of £36.9 million ($44.9 million), driven mainly by a non-cash reduction in the fair value of digital currencies held on the balance sheet. It also brought in £26.7 million in revenue.
"While the first half of 2022 presented many challenges, I am delighted with the progress that we have made in developing Helios and positioning ourselves as a leader in the Bitcoin mining industry," Wall said. "Argo is well positioned to weather the current downturn with its large and highly efficient mining infrastructure, runway for growth, and experienced management team, which has successfully navigated the group through previous crypto winters."
The miner sold 887 BTC last month, at an average price of $22,670 per coin and used most of that revenue to reduce its bitcoin-backed loan with Galaxy Digital down to $6.72 million.
"In response to the challenging market environment, we have adjusted our treasury management strategy," Wall said. "Throughout the period, we have been steadily selling Bitcoin, utilizing derivatives to obtain a higher realized price than simply selling into the market. In Q2 2022, we sold Bitcoin at an average realized price of approximately $28,500, realizing hedge gains in excess of $1,500 per Bitcoin."
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