Low-cost power acquisition expected to add $1 million in annual revenue for Bitcoin miner Gryphon
Gryphon Digital Mining, a small company that brands itself as a carbon-neutral Bitcoin miner, has announced that it entered into an agreement to acquire “ultra low-cost power” assets. It expects to obtain electricity at $0.01 per kilowatt-hour (kWh). According to its own estimates, this could generate up to $1 million in annual revenue.
Details
Gryphon Digital Mining announced the acquisition of mining operations with $0.01/kWh electricity, generated by burning flare gas, a byproduct of oil extraction that is typically burned off. Thus, the amount of gas flared is effectively reduced, which lowers carbon emissions that would have been released otherwise, the company claims.
Gryphon is to acquire up to 2.9 megawatts (MW) of currently running operations with a computational power of 59 petahashes per second (PH/s). Note that a petahash measures how long it takes to complete a block, a fundamental component of the blockchain. The essence of mining is creating new blocks, which become part of the chain and earn the miner coins as a reward. According to the Bitcoin Hashprice Index (designed to track mining profitability), miners are currently earning $43.80 per 1 PH/s.
The price tag of the acquisition was reported at $1.5 million. The company believes that depending on usage, these power assets can generate around $1 million in annual revenue. According to the announcement, low-cost electricity is expected to provide the company with the flexibility to capitalize on various opportunities, including Bitcoin mining, high-performance computing, and machine hosting.
Market reaction
Gryphon opened on Tuesday, August 20, with a slight gain before sliding to end the session down almost 9%, at $0.75 per share. Since the beginning of the year, the stock has now dropped more than 90%. The company’s market capitalization stands at $30 million.
Analyst recommendations
According to MarketWatch, just a single analyst covers the company. The stock is rated a hold, with a target price of $16.00 per share, indicating upside of over 2,000% versus the August 20 close.