To reduce its debt to Michael Novogratz’s Galaxy Digital, a cryptocurrency investment firm, Argo Blockchain began selling Bitcoin holdings earlier this year.
Argo Blockchain, a cryptocurrency firm listed on the London Stock Exchange, has issued a warning saying it may have to shut down if it can’t raise more money.
After announcing on October 31 that it had failed to secure significant funding from a strategic investor, cryptocurrency miner Argo Blockchain said it would continue to look into alternative financing options.
Over the past few months, Argo has been promoting a subscription for ordinary shares to raise approximately 24 million British pounds ($27 million). “The company no longer believes that this subscription will be consummated under the previously announced terms,” Argo said.
The signing of any definitive agreements or the completion of any deals is not guaranteed while Argo investigates other financing options. Argo said the company will keep trying for a year from the day of the announcement before giving up on raising enough money.
If Argo is unable to secure funding during this time, the company has stated that it will be forced to reduce or even cease operations.
“Should Argo be unsuccessful in completing any further financing, Argo would become cash flow negative in the near term and would need to curtail or cease operations.”
Argo has been trying to conserve cash and increase liquidity despite the lack of financing. In October 2022, the final batch of the initial Bitmain order will be installed, and the company just sold 3,843 brand-new Bitmain S19J Pro miners for $5.6 million. A constant 2.5 exahashes per second was maintained as Argo’s maximum hash rate.
Related: Bitcoin miners rethink business strategies to survive long-term
To reduce its debt to Michael Novogratz’s crypto investment firm Galaxy Digital, Argo has been selling its holdings of Bitcoin that it mined. Following the June 2022 disposal of 637 BTC, Argo has now disposed of a total of 887 BTC. By doing so, Argo joined the ranks of other crypto mining firms like Bitfarms, Core Scientific, and Riot Blockchain that have chosen to sell their own mined Bitcoin (BTC) during the bear market of 2022.
As the cryptocurrency bear market continues, Argo is not alone among crypto mining companies in its struggles to stay afloat. Core Scientific, a Bitcoin mining company, issued a bankruptcy warning on October 26 in documents filed with the U.S. Securities and Exchange Commission. The company blamed industry problems, such as falling BTC prices and rising electricity prices.
Continue Reading Original from Coin Telegraph
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