Argo Blockchain PLC Announces January Operational Update

Rhea-AI Summary

Argo Blockchain plc, a global leader in cryptocurrency mining, reported a 20% decrease in daily Bitcoin production in January 2024 compared to the prior month. The decrease was driven by a 16% decrease in Bitcoin-denominated hashprice and weather-related curtailments. Mining revenue also decreased by 19% to $5.3 million. The company held digital assets worth the equivalent of 18 Bitcoin as of January 31, 2024.

Positive

• Argo Blockchain is a global leader in cryptocurrency mining.
• The company's CEO, Thomas Chippas, highlighted the contribution of Bitcoin mining to grid stability during extreme weather events.
• The company's share of power credits from January 2024 will offset a portion of the foregone revenue from curtailment.

Negative

• 20% decrease in daily Bitcoin production compared to the prior month.
• 16% decrease in Bitcoin-denominated hashprice.
• 19% decrease in mining revenue compared to the prior month.

Financial Analyst

The reported 20% decrease in daily Bitcoin production from Argo Blockchain signifies a potential challenge for the company's revenue generation capabilities. The subsequent 19% decline in mining revenue from December 2023 to January 2024 is a direct reflection of this reduced output. It is important to consider that the cryptocurrency mining industry is heavily influenced by factors such as hashprice, which is affected by network difficulty and transaction fees. The decline in transaction fees and increase in network difficulty leading to a lower hashprice indicates a less favorable environment for miners, which could impact profitability. Stakeholders should monitor such trends as they can have significant implications for future earnings.

Additionally, weather-related curtailments, particularly at the Helios facility in Texas, indicate operational risks associated with natural events. While the ability to generate power credits during curtailments can mitigate some revenue loss, it doesn't fully compensate for the decrease in production. Investors should assess the resilience of mining operations to external factors and the effectiveness of contingency plans in place. The company's asset holdings, equivalent to 18 Bitcoin, offer a snapshot of its liquid assets, which is critical for evaluating its short-term financial health.

Energy Market Analyst

Argo Blockchain's operational update highlights the interplay between cryptocurrency mining and the energy market. The economic curtailment of operations during Winter Storm Heather in Texas demonstrates the sector's sensitivity to energy price fluctuations. Bitcoin mining is known for its substantial energy consumption and the ability to curtail operations to stabilize the grid is a notable aspect of demand-response strategies. However, this also exposes the company to energy market volatility, which can lead to unpredictable operational costs and affect profitability.

For energy stakeholders, the concept of miners acting as a source of baseload demand that can be quickly curtailed is significant. It suggests that cryptocurrency miners like Argo Blockchain can contribute to grid stability, which is a valuable service during peak demand periods or in situations where renewable energy sources are intermittent. The long-term implications of such dynamics on energy markets and mining operations could be substantial, as they may influence energy policy and the integration of renewable energy sources.

Cryptocurrency Market Analyst

The decrease in Bitcoin-denominated hashprice due to lower transaction fees and higher network difficulty has broader implications for the cryptocurrency market. These conditions reflect a more competitive mining landscape, where the rewards for mining new blocks are diminishing relative to the costs. For investors and stakeholders in the cryptocurrency space, understanding the correlation between network difficulty, transaction fees and miner revenue is crucial. It provides insight into the sustainability of mining operations and the potential for future investment in mining infrastructure.

The mention of Bitcoin miners as contributors to grid stability also underscores the evolving role of cryptocurrency operations in the broader energy ecosystem. As the industry matures, the integration of mining activities with energy management systems could become more pronounced, potentially leading to new business models and investment opportunities within the sector.

LONDON, UK / ACCESSWIRE / February 5, 2024 / Argo Blockchain plc, a global leader in cryptocurrency mining (LSE:ARB)(NASDAQ:ARBK), is pleased to provide the following operational update for January 2024.

During the month of January, the Company mined 124 Bitcoin, or 4.0 Bitcoin per day. This 20% decrease in daily Bitcoin production compared to the prior month was driven by a 16% decrease in Bitcoin-denominated hashprice, and to a lesser extent, weather-related curtailments. Hashprice, which refers to the expected value of hashing power, is a function of the block subsidy, network difficulty, and transaction fees. The decrease in hashprice in January 2024 was driven by lower transaction fees on the Bitcoin network and higher network difficulty compared to December 2023.

Bitcoin production in January 2024 was negatively impacted by weather-related curtailments at the Company's facilities in Quebec and at the Helios facility in Texas. At Helios, the Company's operations were curtailed in response to winter weather conditions which led to elevated power prices across Texas, particularly during Winter Storm Heather. The facility generates power credits during periods of economic curtailment, and the Company's share of power credits from January 2024 will offset a portion of the foregone revenue from curtailment.

Mining revenue in January 2024 amounted to $5.3 million, a decrease of 19% compared to the prior month (December 2023: $6.6 million).

As of 31 January 2024, the Company held digital assets worth the equivalent of 18 Bitcoin.

Month	Bitcoin Mined	Unaudited Mining Revenue, excluding power credits ($USD in millions)
January 2024	124	$5.3

Management Commentary

Argo's Chief Executive, Thomas Chippas, said, "Our Bitcoin production decreased in January as transaction fees retreated from the temporary spike we saw in December. We also experienced some instances of curtailment as a result of winter weather in Quebec and Texas, which is a great reminder of how Bitcoin mining contributes to grid stability during extreme weather events. Bitcoin miners provide a unique source of baseload demand which can be quickly curtailed to free up electricity for other users on the grid."

This announcement contains inside information.

For further information please contact:

Argo Blockchain
Investor Relations	ir@argoblockchain.com
Tennyson Securities
Corporate Broker Peter Krens	+44 207 186 9030
Fortified Securities
Joint Broker Guy Wheatley, CFA	+44 7493 989014 guy.wheatley@fortifiedsecurities.com
Tancredi Intelligent Communication UK & Europe Media Relations	argoblock@tancredigroup.com

About Argo:

Argo Blockchain plc is a dual-listed (LSE:ARB)(NASDAQ:ARBK) blockchain technology company focused on large-scale cryptocurrency mining. With mining facilities in Quebec, mining operations in Texas, and offices in the US, Canada, and the UK, Argo's global, sustainable operations are predominantly powered by renewable energy. In 2021, Argo became the first climate positive cryptocurrency mining company, and a signatory to the Crypto Climate Accord. For more information, visit www.argoblockchain.com.

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.

SOURCE: Argo Blockchain PLC

View the original press release on accesswire.com

How many Bitcoin did Argo Blockchain mine in January 2024?

Argo Blockchain mined 124 Bitcoin in January 2024.

What was the daily Bitcoin production in January 2024?

The daily Bitcoin production in January 2024 was 4.0 Bitcoin per day.

What was the percentage decrease in daily Bitcoin production compared to the prior month?

There was a 20% decrease in daily Bitcoin production in January 2024 compared to the prior month.

What was the mining revenue for January 2024?

The mining revenue for January 2024 was $5.3 million.

What was the percentage decrease in mining revenue compared to the prior month?

The mining revenue decreased by 19% compared to the prior month.

How many digital assets did the company hold as of January 31, 2024?

As of January 31, 2024, the company held digital assets worth the equivalent of 18 Bitcoin.