Argo Blockchain has been selling its Bitcoin holdings earlier this year to cut debt to Michael Novogratz’s crypto investment firm Galaxy Digital.
The London Stock Exchange-listed cryptocurrency firm Argo Blockchain has warned that it’s at risk of ceasing operations due to a lack of financing.
The crypto mining company Argo Blockchain continues to explore new financing opportunities after failing to raise major capital from a strategic investor, according to an announcement on Oct. 31.
Argo has been seeking to raise about 24 million British pounds ($27 million) via subscription for ordinary shares. “The company no longer believes that this subscription will be consummated under the previously announced terms,” Argo said in a statement.
While Argo is exploring other financing options, there can be no assurance that it will sign any definitive agreements or consummate any deals. The firm will continue to work to reach sufficient capital for at least the next 12 months from the day of the announcement, Argo noted.
Argo will have to cut or event halt operations in case it fails to raise capital during this period, the firm noted, stating:
“Should Argo be unsuccessful in completing any further financing, Argo would become cash flow negative in the near term and would need to curtail or cease operations.”
Amid the lack of financing, Argo has been taking measures to preserve cash and optimize liquidity. The company sold 3,843 brand-new Bitmain S19J Pro miners for $5.6 million, which was the last batch of the original Bitmain order scheduled for installation in October 2022. Argo’s total hash rate capacity remained at 2.5 exahashes per second.
Related: Bitcoin miners rethink business strategies to survive long-term
Previously, Argo has also been actively selling its mined Bitcoin (BTC) holdings in order to cut debt to Michael Novogratz’s crypto investment firm Galaxy Digital. In July, Argo sold another 887 BTC after previously getting rid of 637 BTC in June 2022. In doing so, Argo became one of many crypto mining firms that opted to sell self-mined BTC amid the bear market of 2022, including Bitfarms, Core Scientific and Riot Blockchain.
Argo is not the only crypto mining firm that has been struggling to keep operating amid the ongoing bear market. On Oct. 26, Bitcoin miner Core Scientific filed forms with the United States Securities and Exchange Commission, warning about potential bankruptcy proceedings. The firm cited unfortunate industry events like low BTC prices, increased electricity costs and other issues.
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