Riot is among the miners that have managed to earn revenue by shutting down their energy-intensive operations and reselling their power at a premium during shortages. — Reuters
COLORADO: Bitcoin miner Riot Platforms Inc made millions of dollars by selling power rather than producing the tokens in the second quarter as the crypto-mining industry continued to grapple with the impact of low digital asset prices.
The Castle Rock, Colorado-based company had US$13.5mil in power curtailment credits during the quarter, while generating US$49.7mil in mining revenue.
Riot booked US$27.3mil in power curtailment credits last year and US$6.5mil in 2021 from power sales to the Electric Reliability Council of Texas (Ercot), which is the grid operator for the Lone Star state.
Riot’s second quarter net loss narrowed to US$27.7mil, or 17 US cents a share, from US$353.6mil, or US$2.71, when bitcoin prices plunged in the year-ago quarter.
Overall, second-quarter revenue rose to US$76.6mil, though it was less than the average forecast of analysts surveyed by Bloomberg.
The company had US$18.3mil in power credits in June and July based on its latest monthly operational updates, including US$14.8mil in power curtailment credits received from selling power back to the Ercot grid at market-driven spot prices under its long-term power contracts and US$3.5mil in credits received from participation in Ercot demand response programmes.
It is unclear which other crypto-mining companies have participated in the demand response programmes since the inclusion of the providers is “voluntary and does not necessarily mean that an entity is qualified to provide Demand Response Services nor does it distinguish the active or inactive status of an entity,” according to Ercot’s website.
The margins for bitcoin miners have shrunk since last year when the price of bitcoin plummeted and power costs soared.
Riot is among the miners that have managed to earn revenue by shutting down their energy-intensive operations and reselling their power at a premium during shortages.
The miner, which operates one of the world’s largest bitcoin mining facilities in Texas, has made tens of millions of dollars during the hottest months in the state as power demand reached a record high amid the heat waves.
While Riot is among the top mining companies by computing power along with Marathon Digital Holdings and Core Scientific, the miner sets itself apart by its efforts to diversify its business in a prolonged crypto winter.
The miner’s engineering business segment provides electricity distribution product design, manufacture, and installation services primarily focused on large-scale commercial and governmental customers and serves clients across a range of markets including data centre and power generation. — Bloomberg
