Bitcoin Miner Riot Blockchain Posts Disappointing Quarterly Revenue

Bitcoin mining giant Riot Blockchain had a net loss of $36.6 million. The Colorado-based company generated revenue of $46.3 million – down 28% from the previously estimated $54.2 million.

The rising cost of energy has negatively affected many Bitcoin miners. However, Riot’s CEO believes the company was able to leverage its long-term fixed-rate power contract to generate significant power credits and reduce operating costs.

Revenues missing average estimates

The increased loss and low revenue was attributed to the lower Bitcoin production from significant curtailment activities related to the company’s power strategy, as well as a decline in the market price of the crypto-asset.

For the uninitiated, Riot joined several miners in curtailment proceedings in Texas to voluntarily shut down their machines to conserve power during times of high demand. In exchange, Riot earned $13.1 million in power cap credits for the third quarter, a large chunk of $9.5 million coming in July alone. Because of this participation, the company’s bitcoin production for that month fell by 28%.

Riot was able to sell the power back to the Electric Reliability Council of Texas at a market-driven spot price and made a profit.

As a result of reduced customer billings due to curtailment, revenue from data center hosts or fees collected for providing infrastructure to other companies’ machines, the company’s revenue fell to $8.4 million for the third quarter compared to $11.2 million for the same three-month period last year.

North America’s largest BTC mining facility

Several mining companies have struggled under lukewarm market conditions. While Riot’s mining margins have also taken a significant hit, its US Whinstone facility has emerged as the largest Bitcoin mining operation in North America.

The Whinstone facility is undergoing an expansion project and will double the site’s Bitcoin mining capacity to 700 MW. According to the update, the expansion of buildings and critical infrastructure is expected to be completed by the summer of 2022. Upon completion, Riot claimed that the Whinstone facility could be the most significant Bitcoin mining facility in the world, measured by developed capacity.

“This extension includes four new buildings, a total of approx. 240,000 sq ft and adds 400 MW of capacity. The buildings and critical infrastructure for the expansion are expected to be completed in the summer of 2022, with the final components of the building completed in parallel with miner shipments.”