Riot Platforms’ recent acquisition of Bitcoin miners from MicroBT is of significant significance in the context of the upcoming halving event in 2024.
Riot Platforms Inc (NASDAQ: RIOT), a major player in the Bitcoin (BTC) mining industry, has announced a significant development in its quest to expand its mining capabilities.
The company said in a Press release that it has entered into a long-term purchase agreement with MicroBT Electronics Technology Co., LTD, a well-known manufacturer of Bitcoin miners. This strategic partnership aims to bolster Riot’s mining capacity by securing an initial order of 33,280 next-gen Bitcoin miners from MicroBT.
The total consideration for the initial order is $162.9 million, excluding taxes, fees and adjustments. This equates to an approximate cost of $21.50 per terahash (TH), a competitive price for mining equipment.
This strategic move comes ahead of the 2024 halving event, which is expected to bring significant changes to the Bitcoin mining landscape. With this expansion, Riot Platforms aims to solidify its position as a major player in the crypto mining industry and maximize its mining capabilities for the future.
Riot said miners ordered from MicroBT will be produced in the United States specifically for Riot’s Corsicana facility. The move aligns with Riot’s strategy to expand its mining operations in the country. With MicroBT manufacturing the newly acquired miners at a facility in Pittsburgh, Pennsylvania, this collaboration establishes a strong national supply chain for Bitcoin miners, which is an important milestone for the industry.
Additionally, Riot noted that the deployment process is expected to take some time due to the large number of miners involved. According to the agreement, delivery of the new miners is expected to begin in December 2023.
Riot Platforms plans to complete the full deployment of all 33,280 miners by mid-2024. This delay allows for careful setup, configuration, and optimization of mining equipment to ensure peak performance.
Significance of the Riot Platform acquisition for the Halving event
Riot Platforms’ recent acquisition of Bitcoin miners from MicroBT is of significant significance in the context of the upcoming halving event in 2024. Indeed, the halving event, which occurs every four years, reduces block rewards for miners, affecting the economics of Bitcoin mining.
However, once the rollout is complete, Riot’s self-mining hash rate capacity is expected to increase to 20.1 EH/s (exahashes per second). Increasing self-mining hash rate capacity is a strategic move by Riot Platforms.
As block rewards decrease, maintaining a competitive hash rate becomes crucial to mining profitability. By expanding its mining fleet and hash rate capacity, Riot Platforms aims to offset the effects of the halving, ensuring continued profitability and operational efficiency.
This significant increase in hash rate capacity positions the company as a major player in the Bitcoin mining industry, strengthening its role in transaction validation and contributing to the overall security and efficiency of the Bitcoin network.
Benjamin Godfrey is a blockchain enthusiast and journalist who loves to write about real-world applications of blockchain technology and innovations to drive mainstream acceptance and global uptake of emerging technology. His desire to educate people about cryptocurrencies inspires his contributions to renowned blockchain-based media and sites. Benjamin Godfrey is a sports and agriculture enthusiast.