The bitcoin mining industry continues to face a difficult year as the price of bitcoin (
BTC

) is hovering around $20,000 combined with rising electricity prices in North America and Europe. Regulators have also recently begun cracking down on cryptocurrency mining as a recent report from the Bitcoin Mining Council (BMC) found that bitcoin energy consumption has increased by 41% year-over-year (y/y). As a result, a number of cryptocurrency mining companies were forced to sell equipment, while others declared bankruptcy.

However, this is not the case for some mining companies, especially those focused on clean energy solutions and strategic approaches. For example, in September, crypto mining company CleanSpark announced a deal to buy Mawson’s Sandersville, Georgia-based bitcoin mining operation for $33 million. Cryptocurrency mining company White Rock Management also recently expanded its mining operations in Texas.

Why some bitcoin miners thrive in a bear market
Matthew Schultz, executive chairman of CleanSpark, told Cointelegraph that he sees mining as a unique way to lower energy costs when used for reasons other than making money. According to Schultz, this point of view distinguishes CleanSpark from other cryptocurrency mining companies. “Bitcoin mining is a potential solution to create additional opportunities for energy development,” he said.

Schultz elaborated that CleanSpark is partnering with US cities such as Georgia and Texas to purchase excess energy. For example, he noted that CleanSpark works with local areas in Georgia, which receive energy from the Municipal Electricity Authority of Georgia.

“These cities are essentially becoming our utility providers. They earn on every kilowatt-hour that we buy for mining activities. However, we are buying so much energy that it reduces energy costs for the communities we serve. cities to reduce energy costs, he said.

CleanSpark CEO Zach Bradford inspects mining technology at the bitcoin mining company’s College Park campus. Source: CleanSpark
Schultz also noted that CleanSpark has partnered with energy company Lancium to support their data center in West Texas by acquiring excess renewable energy to keep the grid stable. As a result, Schultz revealed that CleanSpark currently has half a billion US dollars in assets on its balance sheet and less than $20 million in debt, as well as backing from investors such as BlackRock and Vanguard. Given this, Schultz believes that the crypto bear market has affected CleanSpark differently than other crypto miners.

For example, he noted that when bitcoin was worth $69,000 a year ago, many miners were discussing plans to store BTC. “These miners have also made big commitments to companies like Bitmain for future mining rig shipments,” he said. However, according to Schultz, CleanSpark conducted a comprehensive analysis of the number of mining rigs ordered last year, as well as looked into future energy consumption forecasts. He decreed:

“We came to the conclusion that instead of sending suppliers a deposit last November for mining equipment that is only now being delivered, we saw the possibility of an oversupply of rigs and increased energy costs. So we sold bitcoin when it was in the $60,000 range and instead invested the proceeds in infrastructure.
Not only did this allow CleanSpark to purchase its new mining facility in Sandersville, Georgia, but Schlutz also noted that the firm is now buying bitcoin mining hardware at a very low price. “We buy rigs at $17 a terahesh, which were $100 a terahesh a year ago.”

With many miners forced to sell their hardware, both used and new mining rigs are being sold at below market prices, creating opportunities for firms like CleanSpark to buy.

Scott Offord, owner of Scott’s Crypto Mining, a service that offers new and used mining hardware as well as mining training courses, told Cointelegraph that miner prices are now very reasonable, in part due to a lack of demand due to the low price. for mining. Bitcoin. Offord added that many of the used miners he currently sells came from hosting companies with debts.

Source: CoinTelegraph

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