Iris Energy Switches Off Its Mining Hardware, Feels the Crypto Winter PlatoAiStream PlatoAiStream. Data Intelligence. Vertical Search. Ai.

Iris Energy Switches Off Its Mining Hardware, Feels the Crypto Winter

Iris Energy, an Australian-based cryptocurrency firm publicly listed on Wall Street (NASDAQ:IREN), has switched off a part of its mining hardware used as collateral in a $107.8 million loan. According to the newest regulatory filing at the US Securities and Exchange Commission (SEC ) from 21 November 2022, the company’s electricity costs increased by 312% over one year.

The secured miners owned by Non-Recourse SPV 2 and Non-Recourse SPV 3 produced insufficient cash flow. Their operations generated around $2 million in crypto profit monthly, which is significantly below the debt obligation of $7 million.

Iris Energy was forced to reduce its hash power to 3.6 exahashes per second (EH/s). However, the company intends to increase its mining potential. It wants to benefit from $75 million in prepayments made to Bitmain, a mining rigs manufacturer, as part of its contracted 7.5 EH/s machines for independent mining.

Moreover, the company announced some preliminary financial results for the third quarter of 2022. Operating revenues reached $16.2 million, which is a significant increase from $10.4 million reported in the previous quarter. However, as mentioned at the beginning, the company had to cover a substantial increase in electricity costs to $6.6 million from $.16 million reported in the same period last year.

A Growing List of Miners’ Problems

The Aussie cryptocurrency mining company is not the only firm whose operations have recently been hovering on a thin profitability line. The prolonged ‘cryptocurrency winter’, a situation where major assets move in a sideways trend at multi-month lows for an extended period, visibly cut potential profit.

Bitcoin has now lost 80% since its historic highs in 2021 when it cost nearly $70,000. Revenues and valuations of publicly traded mining companies on Wall Street are falling accordingly.

Iris Energy’s shares have slipped 90% this year alone, and its rival Canaan has lost 50%. The company reported its third-quarter figures in the first half of November, showing a 90% drop in net income.

On top of that, HIVE Blockchain Technologies Ltd. and Hut 8 Mining Corp. felt the ‘Bitcoin blues’ and reported a sharp decline in revenues despite increasing hash power and a total number of mined cryptos.

The daily profit of BTC miners is now $13 million, which is the lowest in more than two years. Bitcoin currently costs less than $17,000, and until it moves back higher, the condition of the mining industry will certainly not improve.

Iris Energy, an Australian-based cryptocurrency firm publicly listed on Wall Street (NASDAQ:IREN), has switched off a part of its mining hardware used as collateral in a $107.8 million loan. According to the newest regulatory filing at the US Securities and Exchange Commission (SEC ) from 21 November 2022, the company’s electricity costs increased by 312% over one year.

The secured miners owned by Non-Recourse SPV 2 and Non-Recourse SPV 3 produced insufficient cash flow. Their operations generated around $2 million in crypto profit monthly, which is significantly below the debt obligation of $7 million.

Iris Energy was forced to reduce its hash power to 3.6 exahashes per second (EH/s). However, the company intends to increase its mining potential. It wants to benefit from $75 million in prepayments made to Bitmain, a mining rigs manufacturer, as part of its contracted 7.5 EH/s machines for independent mining.

Moreover, the company announced some preliminary financial results for the third quarter of 2022. Operating revenues reached $16.2 million, which is a significant increase from $10.4 million reported in the previous quarter. However, as mentioned at the beginning, the company had to cover a substantial increase in electricity costs to $6.6 million from $.16 million reported in the same period last year.

A Growing List of Miners’ Problems

The Aussie cryptocurrency mining company is not the only firm whose operations have recently been hovering on a thin profitability line. The prolonged ‘cryptocurrency winter’, a situation where major assets move in a sideways trend at multi-month lows for an extended period, visibly cut potential profit.

Bitcoin has now lost 80% since its historic highs in 2021 when it cost nearly $70,000. Revenues and valuations of publicly traded mining companies on Wall Street are falling accordingly.

Iris Energy’s shares have slipped 90% this year alone, and its rival Canaan has lost 50%. The company reported its third-quarter figures in the first half of November, showing a 90% drop in net income.

On top of that, HIVE Blockchain Technologies Ltd. and Hut 8 Mining Corp. felt the ‘Bitcoin blues’ and reported a sharp decline in revenues despite increasing hash power and a total number of mined cryptos.

The daily profit of BTC miners is now $13 million, which is the lowest in more than two years. Bitcoin currently costs less than $17,000, and until it moves back higher, the condition of the mining industry will certainly not improve.

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  • Source: https://www.financemagnates.com//cryptocurrency/iris-energy-switches-off-its-mining-hardware-feels-the-crypto-winter/

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