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Tuesday, December 12, 2023

Bitcoin Mining Investment Commitments Hit $1.2B YTD as BTC Halving 2024 Approaches

Several companies are anticipating the changes expected from the Bitcoin halving next year and have pumped in more mining investments.

The Bitcoin mining industry has consistently picked up steam over the last few months. According to a report from Bitcoin ↗ mining consultancy and PR firm BlocksBridge Consulting, Bitcoin miner investment commitments have crossed $1.2 billion year-to-date.

In its Miner Weekly report, BlocksBridge Consulting notes that since the year began, twelve public mining companies have placed orders for spot and future stocks of Bitcoin miners, with a total capacity of more than 70 EH/s. 

The recent rally in the Bitcoin and crypto sector, along with the anticipated halving, is driving some companies to invest more into Bitcoin. Of the 1.2 billion in YTD investments, about $750 million was signed in the last two months. Also, public mining companies have spent $747 million on equipment, plants, and property from Q1 to Q3 this year. The rest are being paid in monthly installments throughout 2024 and even after.

The report also notes that most of the Bitcoin miner action is from Chinese manufacturers. MicroBT and Bitmain, with 56% and 42%, respectively. Canaan accounts for the rest.

Bitcoin Mining Purchases

There are also several large recorded purchases of WhatsMiners. The report states that there have been four recorded bulk WhatsMiner purchases from manufacturers: Riot Platforms (NASDAQ: RIOT), Bitfarms, and Northern Data. While there are no specifics on models, the purchases have a combined hashrate of 40 EH/s. In addition, UAE-based crypto mining hardware retailer Phoenix Group recently announced it signed a contract to buy WhatsMiners worth $136 million. The company also did not provide model or hashrate specifics.

Riot recently exercised a purchase option to buy 66,560 mining rigs from MicroBT. The purchase is one of the largest in Riot’s history, done in preparation for the forthcoming Bitcoin halving. According to an official press release, the mining rigs have a total capacity of 18 EH/s, and primarily consist of the M66S model, at 48,058 units. There are also 14,778 units of the M66 and 3,724 units of the M56S++. The set cost is $290.5 million.

Riot also secured purchase options to buy rigs capable of an additional 75 EH/s at a fixed price ceiling. The plan is to hit a self-mining capacity of more than 100 EH/S.

The company had an initial agreement with MicroBT in June when it agreed to buy 33,280 rigs. At the time, the deal allowed Riot Platforms to buy up to 265,000 additional miners on the same terms.

The delivery schedule puts the initial deployment of the 33,280 rigs for Q1 2024, with the delivery and deployment for the second order (66,560) sometime in the second half of 2024. All purchases to be made under the current agreement will be delivered latest by H2 of 20225. Riot’s self-mining hash rate capacity is expected to cross 38 EH/s by then.

Bitcoin Mining Uses Clean Energy

In September, a Bloomberg analyst reported that clean energy used to mine Bitcoin rose past 50%. This means that more than half of all Bitcoin mining activity is now powered by renewable energy. This is a welcome development considering that one of the biggest criticisms of Bitcoin and other Proof-of-Work (PoW) blockchains is the amount of energy required for operations.


Bitcoin News ↗, Blockchain News ↗, Cryptocurrency News ↗, News ↗

James Mackreides
James Mackreides
'Mac' is a short tempered former helicopter pilot , now a writer based in Sofia, Bulgaria. Loves dogs, the outdoors and staying far away from the ocean.

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