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Cipher Mining (CIFR) updates on Bitcoin mining plans

By Joyanta Acharjee

15:29, 12 November 2021

Miniature figures illustrate Bitcoin mining
Miniature figures illustrate Bitcoin mining – Photo: Shutterstock

Early-stage US bitcoin miner Cipher Mining updated investors on its plans to set up and mine Bitcoin next year.

Cipher listed on the Nasdaq in August, raising $391m (£292m) in finances from its merger with Good Works Acquisition, a special purpose acquisition company.

As at 10:05 am EST (UTC-5) Cipher stock was down 1.37% at $8.06.

Five data centres planned

The company is in the process of deploying five data centres where Bitcoin mining is expected to begin in early 2022 and has entered into machine contracts for a potential total of between 115,000 and 143,000 Bitcoin mining rigs capable of generating an aggregate hashrate of up to 19.5 EH/s.

Financially, the company has yet to record income from mining as net loss for the period ended 30 September narrowed to $2.4m from $3m in the third quarter of 2020. Costs and expenses were reduced 20% to $2.3m from $2.9m a year earlier.

"We have made tremendous progress deploying our new capital in a disciplined manner and, in just a few short months, plan to begin strengthening Bitcoin’s critical network infrastructure," Cipher Mining CEO Tyler Page said in a press release.

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Cipher Mining timelineCipher Mining timeline – Photo: Cipher Mining

‘Laser-focussed on milestones’

"As we respond to market dynamics and continue to exercise cost discipline, we remain laser-focussed on our execution milestones and preparing the equipment to begin mining in the first quarter of 2022, with a significant ramp-up anticipated for the second half of the year," Cipher's Page said.

Two of Cipher's key executives came from crypto security and infrastructure provider Bitfury. CEO Tyler Page was formerly head of Business Development for digital asset infrastructure at Bitfury and also previously worked for Guggenheim Partners, Goldman Sachs and Lehman Brothers.

Securing power supply

Cipher's head of Power Samy Biyadi, who helped secure several hundreds of megawatts dedicated to bitcoin mining while managing power contracts and counterparties for Bitfury, now oversees Cipher's sourcing, negotiation and portfolio management of power agreements and relationships. He has prior experience with both renewable and traditional energy firms in Europe and in the US.

In its update, Cipher Mining said that it has executed power agreements for up to 910 megawatts at a weighted average power price of approximately 2.72 cents per kWh.

Read more: Bitcoin and Ether pull back from all time highs

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The main difference between CFD trading and trading assets, such as commodities and stocks, is that you don’t own the underlying asset when you trade on a CFD.
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