Bitdeer Secures 30-Year Lease in Ohio, Faces Profitability Concerns Post Bitcoin Halving
Summary:
Bitdeer, a Bitcoin mining company, has secured a 30-year lease with Monroe County Port Authority for a site at the Hannibal Industrial Park in Clarington, Ohio. The company plans to access 570 MW of power from this location in two stages. Industry analyst Mark Palmer has lauded Bitdeer's low energy costing. Moreover, Tether, the stablecoin issuer, invested $150 million in the company. However, post the April 2024 Bitcoin halving, miner profitability is under scrutiny due to high energy costs and reduced block rewards. Argo Blockchain Mining and Hut8 have the highest mining costs among potentially impacted firms, according to Cantor Fitzgerald's research.
On the 28th of June, Bitdeer, a Bitcoin mining entity, revealed that they've secured a 30-year lease agreement with the Port Authority of Monroe County. The location in question is the Hannibal Industrial Park found in Clarington, Ohio. As per Bitdeer's statement, the site formerly housed an aluminium manufacturing plant and already has the required power infrastructure for Bitdeer's mining activities. The company has plans to access an additional 570 MW of power via the site in two stages: the first 266 MW by the third quarter of 2025, and the remaining 304 MW only after being reviewed by power authorities.
Bitdeer has been earning industry praise; in March, Mark Palmer, an analyst, voiced his optimism regarding Bitdeer, citing the company's impressive low energy costs, averaging $0.04 per kilowatt-hour, as a significant factor in the success of its Bitcoin mining operations. Moreover, in May, Tether, the stablecoin issuer, invested $150 million into Bitdeer, securing over 18 million shares. Tether also has the option to acquire an additional five million shares at the rate of $10 per share.
The future profitability of miners has become a critical concern for the industry post the April 2024 Bitcoin halving, where miners are dealing with escalating energy costs and a decreased block reward of 3.125 Bitcoin (BTC). A survey by Cantor Fitzgerald, a fintech firm, proposed that several Bitcoin mining companies may likely face loss post the April halving due to the considerable mining costs involved in mining a single Bitcoin. The study found mining costs ranging from $43,913 to $62,276 per BTC for the 11 potentially affected mining corporations.
Cantor Fitzgerald's research highlighted that Argo Blockchain Mining's mining cost was the highest, at a staggering $62,276 per Bitcoin, while Hut8 was seen trailing closely with a mining cost of $60,360 per coin. Cantor Fitzgerald's research, however, relies on $40,000 as the market price to calculate profitability threshold, but this level hasn't yet been regained since the halving.
Published At
6/28/2024 11:36:19 PM
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