Cipher Mining Lowers Per-Terahash Cost of Crypto Mining Rigs Even as Quarterly Loss Widens

The miner expects to have 6.9 exahashes per second of computing power deployed by early 2023.

AccessTimeIconAug 9, 2022 at 2:22 p.m. UTC
Updated May 11, 2023 at 5:40 p.m. UTC
10 Years of Decentralizing the Future
May 29-31, 2024 - Austin, TexasThe biggest and most established global event for everything crypto, blockchain and Web3.Register Now

Cipher Mining (CIFR) said it lowered its spending on bitcoin mining rigs by about $10 per terahash/second while reporting a second-quarter net loss Tuesday that was wider than its loss in the first quarter.

  • The New York-based company, which became listed in a merger with a special purpose acquisition vehicle last August, posted a net loss of $29 million for the second quarter, compared with a net loss of $17.5 million for the first quarter.
  • The miner has 1.3 exahashes per second (EH/s) running at its 40 megawatt facility in Alborz, Texas, and another 0.6 EH/s of computer power that was en route to two other facilities. Mining rigs will "soon" start shipping to a 205 MW site, its largest, according to the earnings report.
  • The fleet will be running at an efficiency of 32.1 joules per terahash (J/TH) that was bought at an average price of $34.96 per terahash/second (TH/s). That's lower than the $45 TH/s it reported in the first quarter and in line with market pricing. Rigs with efficiency of under 38 J/TH are priced at $35.20 per TH/s, according to information platform Luxor Hashrate Index.
  • Cipher has put down $196.7 million in deposits for equipment, down from $207 million in the first quarter, according to the report. It has mostly paid off its equipment contract with Bitmain for 27,000 rigs, barring a final payment that it plans to cover with a company credit, CEO Tyler Page said during the earnings call on Tuesday.
  • It is now starting to accept deliveries for 60,000 rigs from MicroBT. The miner is in talks with MicroBT to "better align" deliveries with the construction progress of the data center, Page said.
  • Cipher has secured a fixed price of about $27 per megawatt hour (about 2.7 cents per kilowatt hour) for its biggest site in Odessa, Texas, which is significantly lower than competitors in the region, the CEO said.
  • Earlier this year, Cipher cut its 2022 power capacity forecast from 405 MW, including 305 MW for self-mining, to 345 MW, including 275 MW for self-mining. The rest will go to hosting other companies' rigs.
  • The firm has no corporate debt, other than its share of an equipment financing agreement for the Alborz site, which is around $11 million, according to the report.
  • Cipher shares fell 4% in early Nasdaq trading.
  • Big Tech Comes to Small Town: A Bitcoin Mining Story in Spur
    15:03
    Big Tech Comes to Small Town: A Bitcoin Mining Story in Spur
  • What's the Biggest Misconception People Have About Bitcoin Mining?
    00:39
    What's the Biggest Misconception People Have About Bitcoin Mining?
  • What You Need to Know About the Bitcoin Halving
    01:47
    What You Need to Know About the Bitcoin Halving
  • Bitcoin Miner Bitfarms Warns of Default
    04:20
    Bitcoin Miner Bitfarms Warns of Default
  • UPDATE (Aug. 9 15:09 UTC): Adds "Crypto" to headline.

    Disclosure

    Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

    CoinDesk is an award-winning media outlet that covers the cryptocurrency industry. Its journalists abide by a strict set of editorial policies. In November 2023, CoinDesk was acquired by the Bullish group, owner of Bullish, a regulated, digital assets exchange. The Bullish group is majority-owned by Block.one; both companies have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary with an editorial committee to protect journalistic independence. CoinDesk employees, including journalists, may receive options in the Bullish group as part of their compensation.

    Eliza Gkritsi

    Eliza Gkritsi is a CoinDesk contributor focused on the intersection of crypto and AI.


    Learn more about Consensus 2024, CoinDesk's longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.