Connect with us

Crypto News

Galaxy Digital Bails Out Bitcoin Miner Argo Amid Bankruptcy Rumors

Published

on

Blockonomi


Bitcoin miner Argo Blockchain announced on Wednesday that it reached a deal with Galaxy Digital in an effort to avoid the threat of bankruptcy. Upon the agreement, Galaxy Digital will acquire Argo’s top mining facility Helios in a $65 million deal.

Argo also gets a $35 million loan from Galaxy Digital to cut off its debts.

Argo Blockchain CEO Peter Wall noted in the official announcement that in face of the ongoing bear market, Argo’s urgent attempt is to keep the business afloat.

Galaxy to the Rescue!

Galaxy Digital’s bailout helps Argo pay the debts and continue operating. The rescue package will be used to “pay off the debt that we owed to NYDIG and a tiny bit to another secured lender,” according to Wall.

Launched in May 2022 in Dickens County, Texas, Helios is Argo’s bitcoin mining facility capable of 200 megawatts (MW) of power. Compared to Baie Comeau and Mirabel, it is Argo’s largest operation in terms of electricity support.

The CEO added that Argo Blockchain and Galaxy Digital have also reached a 2-year agreement that allows the company’s mining machines to keep operating at Helios.

To wit,

“Staying at Helios will also allow us to continue to access power through the Texas grid and participate in the ancillary services, which are provided by Ercot.”

The news came shortly after Argo announced NASDAQ delisting on Tuesday following the leaked document earlier this month.

On Dec. 12, Will Foxley, Director of Content at Compass Mining, shared a screenshot indicating that Argo Blockchain was preparing for a bankruptcy filing. The document was sent by accident, as stated by Foxley.

In fact, a series of negative news broke out before the bankruptcy rumors. On December 9, the UK’s Financial Conduct Authority (FCA) temporarily suspended shares of Argo after the company disclosed a drop in November revenue.

The company had announced in October that it was unable to get $27 million in capital from a strategic investor, which caused the shares to drop by more than 70%.

Early in October, when the firm announced a range of initiatives, including the sale of bitcoin mining equipment, Argo stock started to decline. In November, Argo mined 198 bitcoins, which is less than the 204 BTC mined in October, according to the company’s update.

Bitcoin Mining In Crisis

The Bitcoin mining industry is undergoing a major crisis following a series of events including FED’s interest hikes, Bitcoin’s price decline, and electricity’s escalating cost.

Many Bitcoin miners decided to shut down a number of their machines or even sell off hardware to cover the debts. This also contributes to the drop in the price of Bitcoin mining machines.

Argo is not the only miner that struggles to survive the bear market. Core Scientific, one of the US largest bitcoin mining companies, filed for bankruptcy protection on Dec. 21.

The Texas-headquartered miner also announced its plan to stay afloat amid the crisis while negotiating a restructuring agreement with lenders and creditors.

According to the official announcement made by Core Scientific, the decision was made as a result of decreased operating efficiency and affected liquidity as a result of the long-term drop in prices of bitcoin, rising costs associated with electricity, and the fact that some customers rented out their servers.

Reportedly, the company was also impacted when the virtual currency lending platform Celsius Network failed to pay its creditors. The two businesses are at odds with one another because of the web hosting services that Core Scientific provides to Celsius.

On the other hand, the acquisition provides Galaxy with a significant opportunity to develop into one of the largest bitcoin miners in the world.

Previously, Grayscale would frequently engage in the process of purchasing mining equipment directly from miners. The CEO of Grayscale stated that the entire industry is facing a great deal of pressure, yet this situation presents an opportunity for investors.


Source link

Continue Reading
Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Crypto News

BitPay Announces Partnership With MoonPay – Bitcoin Magazine

Published

on

Bitcoin And Artificial Intelligence Frees Your Time - Bitcoin Magazine


BitPay and MoonPay, leading bitcoin and cryptocurrency payments infrastructure providers, have partnered “to provide BitPay users with significantly increased ways to buy cryptocurrency instantly, and at great rates.”

“BitPay’s unique marketplace experience also presents multiple rates for buyers, ensuring they receive the best possible price for their cryptocurrency purchases,” the press release states. “Additional benefits of the integration include fast delivery to any owned wallet address, as well as the ability for buyers to pay with their preferred method, including credit card, debit card, Apple Pay, Google Pay or a variety of local bank transfer methods.”


Source link

Continue Reading

Crypto News

Why Real Regulatory Change In Crypto Has Not Happened

Published

on

Why Real Regulatory Change In Crypto Has Not Happened



Legislators need to educate themselves on Web3 if they care about protecting consumers, Steven Eisenhauer, chief risk and compliance officer at Ramp, writes.


Source link

Continue Reading

Crypto News

South Korea to deploy cryptocurrency tracking system in 2023

Published

on

South Korea to deploy cryptocurrency tracking system in 2023


The Ministry of Justice in South Korea announced plans to introduce a crypto-tracking system to counter money laundering initiatives and recover funds linked to criminal activities.

The “Virtual Currency Tracking System” will be used to monitor transaction history, extract information related to transactions and check the source of funds before and after remittance, according to local media outlet khgames.

While the system is slated to be deployed in the first half of 2023, the South Korean ministry shared plans to develop an independent tracking and analysis system in the second half of the year. A rough translation of the ministry’s statement reads:

“In response to the sophistication of crime, we will improve the forensic infrastructure (infrastructure). We will build a criminal justice system that meets international standards (global standards).”

The South Korean police previously established an agreement with five local crypto exchanges to cooperate in criminal investigations and ultimately create a safe trading environment for crypto investors.

Related: South Korean prosecutors request arrest warrant for Bithumb owner: Report

The South Korean Supreme Court ruled that crypto exchange Bithumb must pay damages to investors over a 1.5-hour service outage on Nov. 12, 2017.

The finalized ruling from the supreme court ordered damages ranging from as little as $6 to around $6,400 be paid to the 132 investors involved.

“The burden or the cost of technological failures should be shouldered by the service operator, not [the] service users who pay commission for the service,” the court stated.


Source link

Continue Reading

Trending