Bitcoin miner Argo mined 22.4% more bitcoin in July compared with June. It also sold 887 BTC in July, at an average price of $22,670 per coin.
The company used a majority of those revenues to reduce its bitcoin-backed loan with Galaxy Digital down to $6.72 million. Argo had $58.6 million in credit as of March 31, 2022, according to its first quarter results.
In addition to the $45 million it borrowed from Galaxy last year to help finance its Texas facility, the company signed an additional $26.66 million loan from NYDIG in March of this year.
“That is something we’ve been deleveraging from over the last three, four, five months,” said CEO Peter Wall in a video presentation on Friday. “That’s been a strategic decision by the company to make sure that that’s not a future risk if bitcoin was to drop low.”
Argo sold 637 BTC in June. Like it did this month, it had also used the proceeds to pay off debt, bringing its outstanding balance with Galaxy down to $22 million at the end of June. Argo held 1,295 BTC, of which 227 were BTC equivalents, as of 31 July.
Powering down in Texas
Argo’s quarterly results also revealed that the firm mined 22.4% more bitcoin in July (219 BTC), even though like other miners in Texas it curtailed power during periods of extreme heat.
The company did not disclose exactly how much power it had to curtail. But it claimed that miners in Texas had collectively reduced usage by over 1,000 megawatts at peak demand. Rival Riot said this week that curtailed power by 11,717 megawatt-hours (which earned it $9.5 million in power credits from the state) in July. Core Scientific reported today that it curtailed 8,157 megawatt-hours during the month.
As for Argo, it said that energy costs at Helios — its flagship site in Texas — were higher than anticipated. “That’s because we currently have a PPA (a power purchase agreement) that is connected to the index prices, the spot prices,” Wall said. “Power prices are really high. It’s like signing a mortgage when interest rates are really high. You have to wait for them to come down.”
The CEO hopes the company will be able to negotiate a better PPA at a fixed price after power rates go down closer to the end of the summer, into September.
Argo’s margin was 37% in July. “Not a great margin, not where we wanna be and that should change in the future,” Wall said.
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