Bitcoin Miner Argo Blockchain Raises $27M to Ease Liquidity Pressures, Shares Plunge 15%
London-based bitcoin (BTC) miner Argo Blockchain (ARB) has raised $27 million after agreeing to issue 87 million shares to a sole investor.
In an announcement published on YouTube, the firm's CEO Peter Wall explained a number of steps Argo Blockchain has taken to improve its liquidity position in light of the ongoing crypto bear market.
"Our profitability has been squeezed from both sides from higher energy prices to lower bitcoin price, that's resulted in a cash crunch for Argo," Peter Wall said.
In addition to issuing 87 million shares, which equates to around 15% of the business, Argo announced the sale of 3,400 Antminer S19 J Pro miners to a third party for a total of $7 million. The sale of mining equipment will cause a reduction in hash rate, Wall added.
Soaring energy prices coupled with a plunge in the value of cryptocurrencies has created a difficult environment across the mining industry. Compute North, one of the largest operators of crypto-mining data centers, recently filed for bankruptcy after it owed as much as $500 million to at least 200 creditors.
"Assuming all of the transactions close, we're confident we have the liquidity and balance sheet to get us through the next 12 months," Wall concluded.
At press time, shares of Argo Blockchain were down over 15% on the London Stock Exchange.