Prominent Bitcoin (BTC) mining firm Cipher Mining has recently made a significant acquisition, obtaining 16,700 new mining rigs. This move is part of their strategy to establish themselves as a leading player in the industry, especially in anticipation of the Bitcoin halving event scheduled for April.
Expansion Plans and Increased Mining Capacity
Cipher Mining has planned to deploy these state-of-the-art Avalon A1466 miners during the second quarter at its Bear and Chief Mountain facilities in Texas. This deployment will result in a total self-mining capacity of 8.4 exahashes per second (EH/s). The company has partnered with Bear LLC and Chief Mountain LLC, who have reached an agreement with the mining equipment manufacturer Canaan to acquire these miners.
Cipher holds a 49% interest in the joint venture and intends to evenly distribute the newly acquired miners between the Bear and Chief facilities. This expansion will add 30 megawatts of power capacity, equivalent to 1.25 EH/s, to each mining center.
Strategic Timing and Future Growth
Cipher Mining CEO Tyler Page states that the timing of the purchase aligns strategically with the Bitcoin halving event. This event, occurring approximately every four years, involves halving the mining rewards to regulate the rate of new coin issuance. Historically, Bitcoin’s price has experienced significant growth following the halving event. Page adds, “These expansions […] position us for strong growth, and I expect Cipher to be one of the industry winners coming out of the halving.”
The specific cost of the 16,700 miners has not been disclosed; however, Cipher Mining has confirmed that the terms of the agreement were highly favorable. This recent acquisition is not the first collaboration between Cipher and Canaan, as they have previously purchased machines from the same manufacturer.
In addition to the new mining rigs, Cipher had also acquired 37,396 units of the latest generation Antminer T21 miners from Bitmain the previous year. These investments further strengthen their mining capacity.
Operational Update and Market Position
In December, Cipher Mining reported mining 465 BTC, marking a 7.4% increase compared to the previous month. As of now, the company holds 796 BTC on its balance sheet, valued at approximately $34 million.
The firm’s share price (CIFR) has experienced an impressive rebound, surging by 638% from $0.56 to $4.13 in 2023. With its current market capitalization of $1.01 billion, Cipher Mining ranks among the top five mining companies, including Marathon Digital Holdings, Riot Platforms, CleanSpark, and Hut 8 Mining.
Tether’s Investment in the Bitcoin Mining Industry
Aside from Cipher Mining, Tether, the stablecoin giant, has also ramped up its investment in the Bitcoin mining industry. The company has allocated over $800 million this year for investments in various research-related fields, including Bitcoin.
Tether aims to achieve a mining capacity of 120 megawatts through its own operations by the end of 2023. Furthermore, by the end of 2025, they project a capacity of up to 450 megawatts. Paolo Ardoino, Tether’s incoming CEO, revealed their plans to invest approximately $500 million over the next six months to further strengthen their presence in the industry.
