Left HODL’ing the bag?
London-listed Argo Blockchain on Tuesday said crypto enthusiasts are still clamouring for its coin mining services despite a market collapse that has severely dented the profitability of such operations.
The company that made its debut on the London Stock Exchange this August said the total number of crypto mining packages it sold has surged to 10,325 as of Tuesday from 4,200 on October 1.
“Our mining packages are being snapped up as quickly as we make these available and demand continues to exceed supply,” said Mike Edwards, Argo co-founder.
The update boosted Argo’s share price by almost 25 per cent on Tuesday to 5.88p, but the shares remains deeply discounted compared with the listing price of 16p.
Argo offers a service that allows users to mine coins using its servers for a monthly subscription. Mining, the process through which new coins are created by computers that solve complex mathematical problems, was lucrative during the heights of the bitcoin boom late last year but has since run into a series of pitfalls.
“Because of the current depressed price, many bitcoin miners have been unable to sustain operations,” Sam Doctor, head of data science research at Fundstrat Global Advisors, said last week.
Mr Doctor said the cash cost of mining one bitcoin using a popular device is now $4,500 or $5,700 when also including elements like depreciation. Bitcoin traded at $3,964 per coin on Tuesday, down 71 per cent on the year to date and well off highs above $19,000 struck a year ago.
Argo, for its part, remains confident: “Despite a recent downturn in the cryptocurrency market, we are continuing to experience a strong ramp-up in revenues due to good execution of our growth strategy,” Mr Edwards said.