Argo Blockchain shrugs off crypto slide and looks long term

The industry is still at an early stage of growth and new ASIC-based server technology potentially opens up new opportunities for profitable mining at scale

Argo Blockchain PLC (LON:ARB) is confident over the future of Bitcoin and other cryptocurrencies even though prices have slumped recently.

Jonathan Bixby, Argo’s executive chairman, said demand for crypto mining services will grow as the sector becomes more widely accepted.

Argo was only formed in December and launched its cryptocurrency mining platform www.argomining.co in June with around 400 subscribers and capability to support four cryptos: Bitcoin Gold, Ethereum, Ethereum Classic and Zcash.

The plan from this month is to scale up the operation with a waiting list of 50,000 potential users already registered on its website.

Bitcoin, though, has had a tough year shedding almost half of its value and dropping 15% in the last two days alone on reports Goldman Sachs had shelved its crypto trading plans.

Argo raised £25mln at 16p when it listed in the London market in August, making it the first cryptocurrency mining services company to float here.

Yesterday, Argo announced it was introducing new ASIC servers to enable it to support 3.000 subscribers or miners.

“The industry is still at an early stage of growth and new ASIC-based server technology potentially opens up new opportunities for profitable mining at scale,” Bixby said.

Cryptocurrency mining involves using powerful computers to validate transactions on a blockchain system, for which the miner earns the reward of coins in the currency.

It is a slow process, however, and requires substantial amounts of electricity.

Argo wants to open the opportunity to the public and has an operational centre in Quebec, Canada where last month it signed a deal for 9.5Mw of clean energy at a knock-down price.

The group has also leased two additional two data centres in Quebec that have the capacity to serve 150,000 miners.

Losses for the half year to June were £1.15mln.