Bitcoin Mining Giant Argo Blockchain Suffers Negative Cash Flows and Falling Share Prices
Although the crypto winter seems to be over, its impact on Bitcoin and the crypto market still persists. Several crypto-related companies have gone under due to the pressure in the market. Some are still struggling to stay afloat despite the forces’ influence as they manage their operations.
Most companies related to Bitcoin mining get more heat from the fluctuating market trend. Most Bitcoin miners have shut down businesses, but some filed for bankruptcy when they couldn’t weather the storm.
Argo Blockchain is reportedly facing a negative cash flow and the value of its shares is declining. The pressure is getting more intense for the crypto mining giant when it comes to funding its continuous operations. Several mistakes in such financing assignments can lead to a halt in the process or a drastic drop in cash in the future.
Bitcoin Mining Giant Argo Blockchain Without Sufficient Sources To Fight Insolvency
The BTC miner released a press release revealing his past financial plans. It noted how the firm has explored various financial opportunities. However, it has no concrete assurance of signing such agreements or completing fruitful transactions.
It revealed that the company must complete financial activities that offer enough working capital for its operational needs. Such economic growth is necessary for sustainability in the next twelve months from today to avoid bankruptcy.
According to the press, the firm had a partnership plan with an investor to generate $27 million through share subscription. However, the attempt was unsuccessful.
Argo Blockchain also reported the sale of some of its mining equipment to preserve cash and improve liquidity. For example, it recorded sales of around 3,843 brand new Bitman S19J Pro machines in the firm’s latest batch of inventory scheduled for October.
Argo Blockchain stock plummets
Following the latest downward financial stance, Argo’s share performance has plunged. The data indicated a decrease of almost 50% in the last 24 hours. The share report from the beginning of the year also shows a fall of over 80%.
Argo’s fight has been going on for a while now. Finally, the Bitcoin mining company received a BTC-backed loan of $25 million from Galaxy Digital, an investment management company, in September 2021. The loan aims to support the miner’s cash flow requirements and expansion plans in West Texas.
Argo has sold its BTC, which holds monthly throughout 2022. This move is the necessary option to cut its part of the deal and increase its balance. In June of this year, the firm sold around 637 Bitcoin at $24,500 per token.
However, it appears to be selling more Bitcoin tokens than it has produced. In June, the company mined around 179 BTC but sold 637 BTC coins.
featured Image From Pexels, Charts From Tradingview
