Another Bitcoin Mining Firm Warns COVID-19 Pandemic May Harm Its Business

Hut 8, one of the few publicly traded crypto mining firms, is concerned about coronavirus-related delays of new machine deliveries, its CEO said.

Apr 15, 2020 at 8:00 a.m. UTC
Updated Sep 14, 2021 at 8:29 a.m. UTC

Hut 8 Mining Group, a publicly traded cryptocurrency mining firm, is concerned about coronavirus-related delays of new machine deliveries from potential suppliers such as Bitmain and MicroBT. 

During an earnings call last week, CEO Andrew Kiguel said his firm was grappling with a vague timeline for the delivery of crypto mining machines to support its farms, saying that while in February, “you thought” machines could be delivered between March and April, these timelines have since shifted due to the ongoing pandemic. He did not have a revised timeline either.

His remarks follow guidance from competitor Riot Blockchain, which also warned the novel coronavirus outbreak would impact its business operations.

“Three or four weeks ago, nobody thought these things would be an issue, and the world is grappling right now with different supply chain issues like getting ventilators and masks around the world as opposed to bitcoin mining machines,” Kiguel said. 

Bitmain was one of several Chinese miner manufacturers that warned as far back as January – close to eight weeks ago – it would be forced to delay deliveries due to the coronavirus outbreak.

Bitmain has since resumed operations, though its delivery timetable is still unclear.

Halving concerns

Hut 8 Mining Group, one of the few publicly traded mining firms in the U.S., is also closely watching the upcoming bitcoin halving in hopes of appropriately scaling the size of its mining farm.  

The Canadian firm is set to have a higher stake in the bitcoin market after launching its core operation in the middle of 2018 and acquiring facilities to boost its mining power last year. According to its year-end report for 2019, released on Monday, Hut 8 saw $58.6 million in revenue, up by 66 percent from the prior year, thanks to larger capacity and higher bitcoin price. 

This places it as one of the productive miners in North America among its competition, including the Colorado-based Riot Blockchain. 

Hut8’s coronavirus concerns come as the firm prepares for bitcoin’s hotly anticipated halving, tentatively set to occur in mid-May. 

“There's a lot of different scenario planning that we've done,” Kiguel said.

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