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Tuesday, Jun 6, 2023
Mugglehead Magazine
Alternative investment news based in Vancouver, B.C.


Cipher Mining adds another 11,000 ASIC rigs to its fleet in deal with Canaan Inc.

Cipher adopts a strategy of responsible growth throughout the market cycle by buying electricity and machines when market is low

Cipher Mining adds another 11,000 ASIC rigs to its fleet in deal with Canaan Inc.
Image from Karolina Grabowska via Pexels.

Bitcoin miner Cipher Mining (NASDAQ: CIFR) adds 70,000 cryptocurrency mining machines and 7.2 exahash per second (Eh/s) of self mining capacity across all its facilities.

On Tuesday, Cipher bought 11,000 new A1346 model cryptocurrency mining ASIC rigs from Canaan Inc. (NASDAQ: CAN) for use at Cipher’s facility in Odessa, Texas. The company anticipates their ASIC rigs will be delivered and operational by Q3, 2023.

Cipher has deployed over 6.0 EH/s across its initial four data centers. Currently, approximately 96 per cent of the portfolio is powered by fixed-price power, and the weighted average power price at the sites where the company has active contracts is around 2.7 cents per kilowatt-hour.

An exahash is a unit of measurement used to quantify the computing power of a blockchain network like Bitcoin’s. It represents one quintillion hashes per second.

A hash is a mathematical calculation that miners perform to verify and process transactions on the blockchain. The more hash power a network has, the more secure and reliable it is.

In the first quarter of 2023, Cipher reported a diluted net loss of $0.03 per share and a diluted net income of $0.03 per share.

A bitcoin farm. Image from Canaan Inc.

Read more: Hive Blockchain mints 282 Bitcoin in March despite high network difficulty

Read more: Stablecorp relaunches Canadian stablecoin QCAD

Cipher works with Canaan at Odessa to test fleet

Canaan Inc. is a technology company founded in 2013. Its primary focus is on the design of high-performance computing chips utilizing ASIC technology, research and development of chips, production of computing equipment, and provision of software services.

“Over the past several months, our technology and operations teams have been working with Canaan to test its new generation mining machines onsite at Odessa. We are confident that Canaan’s mining machines will be an excellent addition to our fleet, and we expect these mining machines to perform extremely well during the hot summer months in Texas,” said Tyler Page, CEO of Cipher.

According to Page, Cipher has proven its capability to handle the fluctuations in bitcoin mining prices and achieve better investment returns. By buying mining equipment during times when the market prices are low, securing power contracts with fixed prices for a longer duration, and using the profits to expand their facilities, Cipher has adopted a strategy of responsible growth throughout the market cycle.


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