BTC miner CleanSpark scoops up thousands of miners amid 'distressed markets'

Published at: Nov. 2, 2022

Sustainability-focused Bitcoin (BTC) mining company CleanSpark has snapped up another 3,843 cryptocurrency miners amid a backdrop of mining industry consolidation.

The $5.9 million purchase of the Antminer S19J Pro Bitcoin miners announced by the company on Nov. 1 came at a price of $15.50 per terahash — far cheaper than the current market price of $22.94 for a machine with the same efficiency according to data from Hashrate Index.

The purchase has brought its total number of machines to around 50,000 according to the company.

CleanSpark said it's purchased 26,500 miners since the start of the "bear market conditions" — a time when many mining firms have been forced to sell off mining equipment or even consider filing for bankruptcy.

There is a possibility that the miners were purchased from competitor Argo Blockchain as an Oct. 31 update from Argo shows it sold 3,843 Bitmain S19J Pro machines, the exact amount and miner model that CleanSpark purchased.

Cointelegraph contacted CleanSpark and Argo Blockchain to confirm if a transaction took place between the companies but did not immediately hear back.

While other Bitcoin miners are struggling in the prevailing market conditions, CEO Zach Bradford said an “unwavering focus” on sustainability, a strong balance sheet, and its operating strategy has enabled CleanSpark to “acquire machines at incredible prices, grow our hashrate, and increase our daily Bitcoin production.”

In an earlier interview with Cointelegraph Matthew Schultz, executive chairman of CleanSpark, said one of CleanSpark’s operating strategies has been to view Bitcoin mining as a “potential solution for creating more opportunities for energy development.”

For example, CleanSpark partners with various city councils in the United States to buy excess energy in order to improve the efficiency of its mining operations – but it also cuts down energy costs for those communities too, Schultz explained:

“These cities essentially become our utility provider. They make a margin on every kilowatt hour we buy to conduct our mining operations. Yet, we are buying such high quantities of energy that it brings down energy costs for the communities we work with.”

But with Bitcoin mining difficulty increasing and profitability decreasing, mining companies will need to look for new ways to diversify their revenue streams in order to stay afloat, while some companies may have no option but to consolidate to stay in the game.

That was the case with Colorado-based Bitcoin miner Crusoe Energy Systems, who bought the operating assets of portable BTC mining operator Great American Mining (GAM).

CleanSpark also bought a 36MW facility in Washington, Georgia in Aug. 2022, and recently acquired an 80MW facility in Sandersville, Georgia in Oct. 2022 to go alongside its two existing mining facilities.

Despite CleanSpark’s recent success, its stock price dropped 6.32% to $3.26 on Nov. 1 according to Yahoo Finance — however, the fall was representative of the broader Bitcoin mining sector.