About Argo Blockchain

Argo Blockchain plc (Argo) operates as a blockchain technology company. The company focuses on large-scale mining of Bitcoin and other cryptocurrencies. The company mines using purpose-built computers (or mining machines) to solve complex cryptographic algorithms (or verify or solve blocks) in the blockchain in exchange for rewards and fees denominated in the native token of that blockchain network. The company's mining strategy is to acquire and deploy the most advanced mining technology solutions in North American facilities that utilize predominantly renewable and inexpensive electricity. As of December 31, 2022, the company had a fleet of more than 31,000 machines mining Bitcoin and other cryptocurrencies that can generate up to 2,500 petahash per second of computing power. As of December 31, 2022, the company's total hashrate capacity placed it in the top 10 of publicly listed self-miners that report such data. In 2022, the company continued the ongoing shift in its business strategy from contracting for hosting of its mining machines in third party facilities to owning and operating its own data center facilities. During the first part of 2022, the company focused on completing the development and construction of the Helios facility in Dickens County, Texas. When the company acquired the Helios project in March 2021, it was acquiring a strategically-located piece of land with a secured interconnection agreement with the Texas grid for up to 800 MW of electricity. By April 2022, construction was largely complete, and the company energized the facility in early May 2022 and began mining operations. With 180 MW of capacity and utilizing 100% immersion-cooling technology, the Helios facility is one of the largest and most technologically-advanced Bitcoin mining facilities in the United States. In the same month, the company began taking delivery of the new Bitmain Antminer S19J Pro machines that it ordered in September 2021. The company installed the new machines in monthly batches and grew its total hashrate capacity by 55% from 1.6 EH/s in April 2022 to 2.5 EH/s in September 2022. As the company brought operations online at Helios, it began to transition away from its hosted operations at facilities owned by Core Scientific (Core). Between May and July 2022, the company completed a machine swap with Core, whereby new-in-box Bitmain S19J Pro machines were delivered to Helios in exchange for Core taking over its existing fleet of Bitmain S19 machines hosted in its facilities. This machine swap mitigated the logistical challenges and downtime associated with unplugging and shipping the mining machines from Core's facilities to Helios. After completion of the machine swap in July 2022, 100% of Argo's mining machines were operating in the company's own facilities. On December 31, 2022, the company held 141 Bitcoin and Bitcoin Equivalent. In addition to cryptocurrency mining, the company is focused on exploring and investing in strategic initiatives in software and other technologies in the wider cryptocurrency and blockchain sectors. For example, the company intends to diversify its future revenue streams by investing in adjacent cryptocurrency and blockchain technology initiatives, including Decentralized Finance (DeFi) and Non-Fungible Tokens (NFTs). The company has established Argo Labs as a dedicated division within the company to explore and participate in various consensus mechanisms, mainly proof-of-stake networks, including Ethereum, as well as DeFi and NFT projects. Additionally, as part of that strategy, the company has made equity investments in Luxor Technologies, a company providing mining software and services based in the United States; Emergent entertainment plc, a next-generation entertainment company based in the U.K.; WonderFi Technologies, a technology company with the mission of creating better access to digital assets through centralized and decentralized platforms; and ePIC Blockchain Technologies, a company developing hardware and technology for cryptocurrency mining. Cryptocurrency Mining and Mining Pools As a cryptocurrency miner, the company uses specialized mining machines to solve cryptographic math problems necessary to record and 'publish' cryptocurrency transactions to blockchain ledgers. As of December 31, 2022, the company had approximately 2,500 petahash of mining capacity, of which approximately 140 petahash was located in facilities it owns in Quebec, Canada; and approximately 2,360 petahash was located in hosted facilities. Strategy The key elements of the company's strategy are to balance between owned and operated mining facilities, and utilize third party sites; focus on reliable renewable power; and diversify its sources of revenue and value creation by investing in and developing other commercial opportunities at the intersection of energy, finance, and technology. Mining Equipment and Suppliers The company's mining hardware primarily consists of Bitmain Antminer S19, S19 Pro, S19J Pro, T17, S17, and Z11 machines, featuring the latest application-specific integrated circuits (ASICs) for cryptocurrency mining. These machines offer superior speed and efficiency in cryptocurrency mining compared to general computing hardware. The company has a fleet of more than 31,000 ASIC-based mining machines. In the third quarter of 2023, the company expects the delivery of 2,870 mining machines designed and manufactured by ePIC Blockchain Technologies. These mining machines, which utilize the Intel Blockscale ASIC, are expected to be comparable in performance and more energy efficient than the Bitmain Antminer S19J Pro. Exchanges, Trading Venues, and Custodians The company generally sells its mined cryptocurrency assets on a weekly basis in order to fund its operating expenses and for working capital needs. When the company sells its cryptocurrency assets for fiat currency, it typically uses OTC trading desks that are registered as money services businesses where necessary. Rewards earned from mining Zcash and other Equihash-based cryptocurrencies through the mining pool owned and operated by Luxor Technology Corp. are converted by Luxor and paid to the company in Bitcoin. The company's Bitcoin holdings are held by its custodian, Gemini Trust Company, a trust company regulated by the New York Department of Financial Services. Additionally, it may also hold immaterial amounts of cryptocurrencies from time to time in its accounts at digital asset trading venues, in assets management platforms, or in hardware wallets maintained by it. Mining Pools The company contributes 100% of its hash power to mining pools. The company mines Bitcoin through the Foundry U.S.A. Pool, which represents approximately 36% of the total Bitcoin network hashrate, and it mines Equihash cryptocurrencies, such as Zcash through Luxor Technologies Equihash profit switcher. The company is able to switch mining pools relatively quickly and easily. Mining Facilities The company operates its cryptocurrency mining machines from two owned facilities in Canada and one hosted facility in the United States. Marketing The company utilizes traditional media and social media channels for its marketing and communications effort, which principally focus on keeping its investors and other stakeholders informed and up-to-date regarding its operations. Material Agreements In March 2022, the company entered into an equipment financing agreement (the Financing Agreement) with NYDIG ABL LLC (NYDIG), a wholly owned subsidiary of New York Digital Investment Group LLC. In April 2022, the company entered into additional equipment financing with NYDIG under which NYDIG agreed to loan to Argo, in a series of loans from April to September 2022. In December 2022, pursuant to an equity purchase agreement, the company sold the Helios facility and real property in Dickens County, Texas and related assets to Galaxy Digital Holdings, Ltd. (Galaxy). History The company was founded in 2017. It was incorporated in 2017. The company was formerly known as GoSun Blockchain Limited and changed its name to Argo Blockchain plc in 2017.