Argo Blockchain Bitcoin Mining Revenue Drops Drastically Due to Severe Winter in Texas

JAKARTA - Publicly listed Bitcoin mining company Argo Blockchain experienced a significant decline in mining activity in December 2022 due to a winter storm in Texas.

On January 11, Argo released its first operational update since selling its flagship mining facility, Helios, to Mike Novogratz's Galaxy Digital. The company says it was only able to mine 147 Bitcoins in December, compared to 198 BTC in November 2022.

They say that as of December 31, Argo had 141 BTC, with December's mining revenue of $2.49 million (IDR 38.6 billion). Argo's total debt is approximately USD 79 million (IDR 1.2 trillion) and its bank balance is around USD 20 million (IDR 310 billion).

According to the announcement, the decrease in the amount of BTC being mined was mainly due to Argo limiting mining operations on Helios in response to a major winter storm in Texas.

In late December, the United States Department of Energy declared a power emergency in Texas, citing power shortages due to the effects of severe winter weather. Amid catastrophic temperature drops coupled with strong winds, demand on the Texas power grid reached an all-time winter peak of over 74.000 megawatts (MW).

Argo's CEO, Peter Wall, gave an example of the company's mining results being lower than expected because the company had to reduce electricity usage in the network due to extreme weather conditions.

During a winter storm, Argo joined other Texas Bitcoin miners in reducing power usage by around 1.500 MW.

“After the winter storms and associated freezing temperatures subsided, we safely restarted Helios and resumed operations,” Wall said as quoted by Cointelegraph.

Wall said that Argo has finally decided to sell its Helios facilities to Galaxy Digital, announcing the deal worth USD 65 million (IDR 1.01 trillion) on December 28. The transaction aims to reduce Argo's total debt by USD41 million (IDR 637 billion) and improve its liquidity and operating structure.

Even though it is sold, Argo will still continue mining at Galaxy's Helios facility. Argo's total hash rate capacity continues to be 2.5 exahashes per second.