Galaxy’s vertical bet

Bookmark mining cheat sheets for bitcoin class 2023

Dec 31, 2022

The big news this week was Galaxy Digital scooping up distressed assets from Argo Blockchain: The firm bought the miner’s Helios facility in Texas for $65 million.

Argo previously boasted the site’s Phase 1 capacity this year to be 200 MW, which implies a price tag of $325k/MW. Interestingly, the deal sees major role changes in that Argo becomes a hosting client at its co-location provider Galaxy.

Per the chart below from TheMinerMag, Galaxy Digital has notably increased its self-mining production this year already with a seemingly competitive cost of production. Its plan to be more vertically integrated is not surprising at all.

Galaxy’s executive team said during the Q3 earnings call in November:

“We are spending a lot of time on… [evaluating] bigger, longer-lived infrastructure assets that are available and would make sense for us to accelerate our plan to vertically integrate. That is something that we have an entire team spending all of their waking hours on, and have been for the last few months here, so I can’t point to anything specific yet, but know that we are very active in evaluating what’s out there right now.”

Finally, 2022 is coming to an end. There have been many frauds and lies this year. But it’s a good reminder that math does not lie and in math we trust. If you have new recruits in 2023, quiz them on these basic bitcoin mining math. Happy New Year!