Argo Blockchain sold its Bitcoin holdings earlier this year to reduce debt to Michael Novogratz’s cryptocurrency investment firm Galaxy Digital.
Cryptocurrency firm Argo Blockchain, listed on the London Stock Exchange, has warned that it is at risk of ceasing operations due to a lack of funding.
Crypto mining firm Argo Blockchain continues to explore new funding opportunities after failing to raise significant capital from a strategic investor, according to an Oct. 31 announcement.
Argo sought to raise some 24 million pounds sterling ($27 million) by subscribing for ordinary shares. “The company no longer believes this subscription will be terminated under previously announced terms,” Argo said in a statement.
While Argo is exploring other financing options, there can be no assurance that it will enter into definitive agreements or close deals. The company will continue to work to raise sufficient capital for at least the next 12 months from the day of the announcement, Argo said.
Argo will have to cease operations or stop the event if it fails to raise capital during this period, the company noted, saying:
“If Argo is not successful in closing any additional financing, Argo will be cash flow negative in the short term and will have to scale back or cease operations.”
Faced with a lack of funding, Argo took steps to preserve cash and optimize liquidity. The company is selling 3,843 new Bitmain S19J Pro miners for $5.6 million, which was the last batch of Bitmain’s original order scheduled to be installed in October 2022. Argo’s total hash rate capacity remained at 2.5 exahashes per second.
Related: Bitcoin Miners Rethink Trading Strategies for Long-Term Survival
Previously, Argo also actively sold its mined Bitcoin
Holdings to reduce the debts of Michael Novogratz’s cryptocurrency investment firm, Galaxy Digital. In July, Argo sold another 887 BTC after previously releasing 637 BTC in June 2022. In doing so, Argo became one of many crypto mining companies that decided to sell self-mined BTC in the 2022 bear market, including Bitfarms. , Core Scientific and Riot Blockchain.
Argo is not the only crypto mining company that has struggled to continue operating during the ongoing bear market. On Oct. 26, Bitcoin miner Core Scientific filed forms with the US Securities and Exchange Commission to warn of potential bankruptcy proceedings. The company cited unfortunate industry events such as low BTC prices, rising electricity costs, and other issues.