London-based cryptocurrency miner Argo Blockchain PLC revealed a decline in Bitcoin production for January, resulting in a 7.81% drop in its shares.
The company attributed the reduction in mining output to several factors, including a 20% decrease in daily production compared to December. This decline was primarily driven by a 16% drop in Bitcoin-denominated hash price.
Argo Blockchain Shares Experience Dip
According to data from the London Stock Exchange, Argo Blockchain’s shares fell by 7.81% to 14.75 pence each in London on Monday, February 5.
In an official statement, the company disclosed that it mined 124 Bitcoin in January, averaging 4.0 BTC per day. The decrease in daily production was mainly due to the decline in Bitcoin-denominated hash price, influenced by lower transaction fees on the network and increased mining difficulty compared to December.
Weather-related challenges were also cited as a contributing factor to the production decline. Argo Blockchain experienced operational disruptions at its facilities in Quebec, Canada, and its Helios facility in Texas. Severe winter weather conditions, particularly during Winter Storm Heather, led to higher power prices across Texas, resulting in the temporary suspension of operations at the Helios facility.
Argo Blockchain explained, “At Helios, the company’s operations were curtailed in response to winter weather conditions, which led to elevated power prices across Texas, particularly during Winter Storm Heather. The facility generates power credits during periods of economic curtailment, and the company’s share of power credits from January 2024 will offset a portion of the foregone revenue from curtailment.”
Argo Blockchain’s Mining Revenue Declines to $5.3 Million
In terms of mining revenue, Argo Blockchain reported $5.3 million for January, representing a 19% decrease compared to the previous month’s figure of $6.6 million. As of January 31, 2024, the company held digital assets equivalent to 18 Bitcoin.
Argo Blockchain’s CEO, Thomas Chippas, acknowledged the challenges faced in January. He stated, “Our Bitcoin production decreased in January as transaction fees retreated from the temporary spike we saw in December. We also experienced some instances of curtailment as a result of winter weather in Quebec and Texas, which is a great reminder of how Bitcoin mining contributes to grid stability during extreme weather events.”
Chippas highlighted that cryptocurrency miners provide a “unique source of baseload demand which can be quickly curtailed to free up electricity for other users on the grid,” emphasizing the role of Bitcoin mining in supporting grid stability during adverse weather conditions.