In order to boost the company's visibility in the bitcoin mining industry, Mike Novogratz, CEO of Galaxy Digital Holdings, has referred to the Helios mining agreement as a "transformative purchase" for the company. In a dramatic move to avoid bankruptcy, Argo Blockchain revealed on December 28 that a cryptocurrency investment group had paid $65 million to acquire its primary mining site.
https://twitter.com/galaxyhq/status/1608102932360167425?ref_src=twsrc%5Etfw%7Ctwcamp%5Etweetembed%7Ctwterm%5E1608167652177870849%7Ctwgr%5Ebbe9789b2b3586fe7cc5169abd6412987012bd88%7Ctwcon%5Es4_&ref_url=https%3A%2F%2Fcointelegraph.com%2Fnews%2Fmike-novogratz-calls-helios-a-transformative-acquisition-for-galaxy
"We’ve agreed to acquire the Helios facility from @ArgoBlockchain, accelerating the expansion of our bitcoin mining operations and enabling us to act as a host for others." "Learn how Galaxy’s building one of the most trusted sites of the decentralized future" tweeted Galaxy's verified account.
On December 29, Novogratz tweeted about the transaction, emphasizing that Galaxy is a "firm believer" in the long-term viability of bitcoin and that the business will continue to expand its mining activities.
https://twitter.com/novogratz/status/1608167652177870849?ref_src=twsrc%5Etfw%7Ctwcamp%5Etweetembed%7Ctwterm%5E1608167652177870849%7Ctwgr%5Ebbe9789b2b3586fe7cc5169abd6412987012bd88%7Ctwcon%5Es1_c10&ref_url=https%3A%2F%2Fcointelegraph.com%2Fnews%2Fmike-novogratz-calls-helios-a-transformative-acquisition-for-galaxy
The Mining Industry thesis
In a Twitter thread, the Galaxy CEO gave a detailed explanation of the agreement, outlining that the company has a certain thesis regarding how to handle the mining industry, which includes "low-cost electricity, a much more efficient crew, and purchasing ASIC miners at a low price."
"That's a prescription for mining success, even when the hash rate increases," he asserted.
"Over time, we’ll transition our miners to sites we own." Helios also enables us to act as a host for other miners. "Congratulations to @cferraro06, @_amanda_fab, and the rest of the @GalaxyHQ mining team for achieving this incredible milestone." Novogratz tweeted.
The most effective ASIC miners have seen their prices drop by 86.8% from their peak in May 2021, according to recent data from Hashrate Index, which shows that Bitcoin ASIC miner costs are currently hanging around lows not seen since at least 2021.
Trading, asset management, cryptocurrency mining, venture capital, and investment banking are among the five business segments that Galaxy operates in. Its website indicates that the assets it is managing are worth $1.9 billion at the moment.
As of now, Galaxy has used hosting services primarily for its mining activities. However, Novogratz points out that having a 200 MW Helios will enable the business to host more mines in addition to operating its own on-site operations.
With its potential for significant scalability, Helios could become one of the largest miners available. Argo Blockchain earlier stated that it had intentions to grow its electrical capacity to 800 MW in the next few years in a statement from May of this year.
The company also predicted that Helios would be able to mine Bitcoin at a rate of 5.5 exahashes per second by the end of the year, with the potential to increase to 20 EH/s in the future.
Galaxy's past success
Considering that Galaxy also provided Argo Blockchain with a $35 million equipment finance loan with the acquisition, it would appear that Galaxy has some money to burn during the 2022 bear market. The action builds on Galaxy's past success, which came after it paid an unknown sum to acquire the cryptocurrency self-custody platform GK8.
After the failed cryptocurrency lender acquired the company for $115 million in 2021, GK8 came up for auction as part of the Celsius bankruptcy process. The purchase, according to Novogratz, is "a vital cornerstone in our endeavor to build a genuinely full-service financial platform for digital assets."
