Thursday’s trading session after hours saw a sharp decline in CleanSpark’s stock price. Details of a modification to the company’s at-the-market (ATM) offering agreement are mentioned in the conference. In accordance with the terms of the earlier contract with H.C. Wainwright & Co., the company stated that it would be able to sell up to $800 million worth of stock, which it did on January 5, 2024, for $500 million.
Amendment to ATM offering agreement
On March 28, 2023, CleanSpark notified to the Securities and Exchange Commission an updated version of the ATM offering agreement. The company is now legally permitted to issue and sell common stock at a price of $0.001 per share as a result of this reorganization. Riot Platforms and Marathon Digital Holdings are only two of the miners using this crucial arrangement to generate revenue, CleanSpark being one of them.
The news was made public for after-hours trading, and in a matter of seconds, CleanSpark’s shares saw a sharp decline, falling 16% to close at $19.1. The bots’ disruption during regular stock market hours exceeded with data from Google Finance, and the slide that accelerated with darkness had a speed of 8.2% percent. The present market value is $4.2 billion; the proposed stock offering of $800 million is proposed to reduce the number of owners, resulting in a 19% dilution.
Poise prior to the halving of Bitcoin
As seen by the calculated choices to clean a rock, the organization is set up for the Bitcoin era, coinciding with the halving event scheduled for April. Instead of 6.25 BTC ($441,000), the miners will receive half of their reward for their system contributions in this scenario, or 3.125 BTC ($220,500). In addition, Clean Spark has the lowest post-halving cost structure among miners for Bitcoin mining, according to a CoinShares report published on January 12. The cost structure is computed at $26,900.
In order to get ready for the impending halving event, the CleanSpark team has worked hard to build a larger business. With a goal to double its hash rate over the next six months, the business said on Thursday that it has reached an agreement to buy four additional mining facilities in Mississippi, with a retail value of approximately $19.8 million. The mine’s capacity was enhanced by 2.4 EH/s with the addition of these facilities.
In light of this, CleanSpark also had plans to purchase a second facility in Dalton, Georgia for $6.9 million. However, the company’s strategy is for it to be a new production with a hash rate of 0.8 EH/s, and it will go live in April 2024.
