Argo Blockchain saw its Bitcoin mining margin drop to 20% in August

Crypto Update
3 Min Read

Argo Blockchain PLC (Loan: Arab), a publicly traded Bitcoin The mining company, one of the largest in the world, has issued an operational update showing that its mining margin dropped to 20% in August.

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in this latest blockchain newsand according to the company Announcement Friday, the reduction in mining margins – from 37% in July – was down to two factors:

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bitcoin (B T c) a 11% drop in prices during the month and rising electricity costs at the firm’s mining facility Helios.

Specifically, Argo’s power purchase agreement provides for the spot purchase of electricity at its Texas-based facility. In August 2022, spot market prices averaged $0.09 per kWh, nearly three times the prices in previous years, a scenario that has contributed to lower margins.

Argo’s mining revenue up

Firm points to 204% jump, explaining higher location electricity costs in West Texas natural gas Prices, the highest in the month compared to the same period in 2018-2021. The gas price problem, Argo argues, is due to the effects of the war in Ukraine as well as low storage levels of the commodity in the US.

But despite this downside, Argo Blockchain mined 235 BTC during the month – compared to 219 BTC mined in July. The increased hash rate in Helios and the installation of new Bitmain S19J Pro miners has increased the overall hash rate to 2.5 EH/s and puts the company on track to achieve the target of 3.2 EH/s by the end of October 2022 .

The company has signed a strategic custody agreement with an undisclosed third party that will allow efficiencies in Helios and add to Hashrate, Peter Wall, Argo’s chief executive officer, noted in a statement.

“While our mining margins are lower than expected, recent high natural gas and electricity prices are a temporary reflection of wider market dislocations, and we believe electricity prices will align with historical trends in the near future. In addition, Electricity prices are seasonal, and we expect prices to come down as temperatures drop during the colder months.

Argo held 1,098 bitcoins as of 31 August 2022, while mining revenue was £4.39 million ($5.23 million), up from £3.89 million ($4.73 million) in July. The company’s shares rose more than 10% on Friday blockchain stock The broader risk appetite reflects the crypto market as well as the crypto market with a new boom.

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