Despite the significant dilution, the RIOT stock price has remained rather stable as of this writing.
Riot Blockchain, a Bitcoin (BTC) mining company, announced on Thursday that it would be selling up to $500 million in common stock to fund general corporate expenses such as working capital, repayment of corporate obligations, capital expenditures and acquisitions, and investing in existing and future projects in a document filed with the US Securities and Exchange Commission (SEC).
The company would have over 139 million units of common stock outstanding after the offering, giving it a market cap of about $3 billion at Friday’s prices. In total, the corporation has the authority to issue 170 million units of common stock.
Riot Blockchain is now running a fleet of Antminers from Bitmain Technologies. By the fourth quarter of 2022, the company plans to have over 80,000 Bitcoin miners. Riot Blockchain expects its mining power to reach roughly 7.7 exahash per second by then, accounting for about 3.8 percent of the Bitcoin network’s overall hash rate. The company’s mining rigs are focused in its Whinstone complex in Rockdale, Texas, probably due to the state’s low electricity prices.
Riot Blockchain announced in October that it has increased its Bitcoin production year over year and was holding $194 million in BTC at the time. However, in February, the company’s output was severely harmed when it temporarily shut down 99 percent of its operations as a winter storm reached Texas. Riot Blockchain had a tangible book worth of $834.6 million at the end of 2021, owing to its plant, property, and mining equipment.
Disclaimer: These are the writer’s opinions and should not be considered investment advice. Readers should do their own research.