logo

Bitcoin miner Argo Blockchain plans to file for bankruptcy

Argo

TL;DR Breakdown

  • Crypto miner Argo Blockchain mistakenly reveals plans to file for bankruptcy in a few days.
  • The miner, along with several others, has been struggling financially lately.
  • Bitcoin mining difficulty reached a new high on Dec. 6.

Argo Blockchain, a company that mines cryptocurrencies, made public its intentions to file for bankruptcy earlier than expected on December 12 due to an administrative error.

Will Foxley, the Content Director at Compass Mining, was the one who first posted a screenshot of the special announcement made by Argo Blockchain on December 9.

Included in the paper with the heading “Special Information for Stakeholders” was an Argo Special Announcement, which revealed that the cryptocurrency mining firm would voluntarily file a petition for protection under Chapter 11 of the United States Bankruptcy Code just two days from now.

Foxley continued by saying that it makes him sorry to watch so many bright teams being washed out by the harsh economics of mining, but at the same time, he wished all those who were weathering the storm the best of success.

What has been going on with Argo Blockchain

On Friday, December 9, trading in the shares of Argo Blockchain (ARBK), which is located in London, was halted in both the United Kingdom and the United States. The specific reason for the suspension was not made public, although in most cases, it is because an important announcement is about to be made.

According to a statement that the company issued to the London Stock Exchange at the time, in the event that Argo is unable to secure any additional financing, the company will soon experience a negative cash flow and will be forced to either scale back its operations or cease doing business entirely.

Argo announced at the end of October that a proposal to raise $27 million from a strategic investor had failed to fall through, which resulted in the company’s share price plummeting by more than 70 percent.

A portion of Argo’s bitcoin assets were utilized, in August, to satisfy bitcoin-backed debt obligations owed to Galaxy Digital. This was done before the unsuccessful funding attempt in October.

When compared to the 204 bitcoin or bitcoin equivalents that were mined in October, the blockchain technology business located in London mined 198 bitcoin or bitcoin equivalents in November.

This was mostly as a result of an increase in the difficulty of using the Bitcoin network. The overall hashrate of the business remains unchanged at 2.5 exahashes per second. Mining profit for the month of November came in at 29%, down from 32% in October.

Argo and many other publicly listed bitcoin miners have been experiencing difficulties as of late due to the combination of declining cryptocurrency prices and increasing expenses of electricity.

Bitcoin miners are experiencing financial difficulties, which is dimming the shine of the digital gold rush in the state of Texas. As a result, Bitcoin miners are leaving behind what some fear will be a wasteland of incomplete sites and abandoned equipment.

To achieve its goal of becoming a haven for cryptocurrency mining, the state of Texas has aggressively courted miners by offering cheap power and favorable regulations. As a result, many miners have taken out loans totaling billions of dollars in order to purchase expensive machines and build infrastructure.

On December 6th, the Bitcoin mining difficulty was reduced by 7.32%, the largest drop since July 2021. The firm said in its November operating report released on December 9 that it is still looking for working capital to meet its current needs and that further information would be provided at a later date.

Disclaimer: The information provided is not trading advice. Cryptopolitan.com holds no liability for any investments made based on the information provided on this page. We strongly recommend independent research and/or consultation with a qualified professional before making any investment decision.

Jai Hamid

Jai Hamid

Jai Hamid is an enthusiastic writer whose current area of interest is the blockchain sector. Whenever she is not reading or writing, you can find her tending to her plants in the garden. She strongly believes that crypto is going to transform the world for the better.

Related News

Hot Stories

Crypto user behind $116m Mango Markets exploit waives right to bail
What are the Top 15 Crypto Podcasts?
Solana price analysis: SOL drops again after failing at $26 resistance
Most Crypto-friendly Countries for Crypto Traders and Investors
Olympus DAO: All You Need to Know

Follow Us

Industry News

Crypto user behind $116m Mango Markets exploit waives right to bail
Indian retail giant Reliance will be accepting CBDC digital rupee
Coinbase's stock increases after Fed hikes interest rate
A documentary about SBF and CZ’s relationship is in the works
SOL-based lender Everlend Finance shuts down

Add Your Heading Text Here