What is Riot Blockchain? Why it is so controversial? Is it a Good Stock to Buy?
Table of contents
Table of contents
What is Riot Blockchain?
Riot Blockchain is a vertically integrated Bitcoin mining company. It is one of the largest publicly traded Bitcoin miners in the United States.
The company operates a large-scale mining facility in Rockdale, Texas, which is powered by renewable energy.
It also provides hosting services to other Bitcoin miners. It’s mining facility in Rockdale is the largest Bitcoin mining facility in North America.
The company’s hosting services allow other miners to rent space in its mining facility and use its electricity. this can be a more-effective way for smaller miners to participate in Bitcoin mining.
Mining Facility of Riot Blockchain
Mining facility in Rockdale is the largest Bitcoin mining facility in North America. The facility has a total capacity of 700 megawatts,which is enough to power over 100,000 homes.
The facility is powered by renewable energy, including solar and wind power.
- Riot Blockchain has bought the electrical equipment provider ESS Metron.
- The deal is valued at $50 million, paid in 715,413 Riot common stock shares and $25 million in cash.
- Denver-based ESS Metron is a crucial supplier to Riot’s Whinstone, Texas, facility.
valued at about $50 million, and the payment will be made in 715,413 shares of Riot common stock and $25 million in cash.
“The successful acquisition of ESS Metron marks yet another milestone in establishing Riot as a leader in Bitcoin mining,” Riot CEO Jason Les said in the release.
“Riot’s strategic position across the electrical supply chain is significantly enhanced as the company will benefit from ESS Metron’s existing relationships with leading electrical suppliers globally.”
Denver-based ESS Metron is a key supplier to Riot’s Whinstone, Texas, facility, being “highly complementary” to Riot and its ongoing expansion towards 700 megawatts (MW).
The electrical equipment maker has 60 years of experience and provides “highly engineered, custom product offerings mission-critical” to deploy bitcoin mining operations at scale.
Read More Bitcoin Price-What’s Fueling Its Rise?
Introduction to Riot Blockchain?
Two years ago, a failed medical device maker called Biopix abandoned its original business,ordered thousands of Bitcoin mining rigs,and rebranded itself as Riot Blockchain.
At the time, it seemed like Riot was just another company trying to jump on the crowded Bitcoin and blockchain bandwagon to attract new investors.
Nevertheless, Bitcoin’s soaring price and meme stock rally subsequently propelled Riot’s stock price from the single digits to nearly $78 last February.
At that peak, Riot valued at $6.1 billion or 29 times the $213 million in revenue it would go on to generate in 2021.
The company was founded in 2000 as Bioptix, Inc., a medical research company.
In 2017, the company changed its name to Riot Blockchain and began to focus on Bitcoin mining.
But Riot;s stock crashed as rising interest rates drove investors away from riskier investments like growth stocks and cryptocurrencies.
That exodus caused Bitcoin’s price to plunge from a peak of roughly 465,000 in November to about $20,000 today.
Bad news for Riot, whose entire business and frothy valuations tightly tethered to Bitcoin’s volatile price.
Read More Mining Pool-What Is Bitcoin Mining?
How does Riot Blockchain Work?
1.Purchases and operates Bitcoin mining equipment
2.Mines Bitcoin using its own equipment and the equipment of others.
3.Provides hosting services to other Bitcoin miners.
4.Invests in other Bitcoin -related businesses.
What is the Strategy of Riot Blockchain?
First, Riot’s strategy is straightforward. Raise cash, buy more Bitcoin mining rigs from Bitmain,mine more Bitcoin ,and recognize that Bitcoin as revenue.
At the end of May,this year, it had deployed a fleet of approximately 43,458 mining rigs with a hash rate capacity of 4.6 exahashes per second (EH/s).
The EH/s metric is used to measure the overall efficiency of a Bitcoin miner’s operations. Riot acquired a large Bitcoin mining facility Whinstone last year to accelerate its expansion.
First, Bitcoin is the cryptocurrency that Riot Blockchain mines. Mining is the process of using computer hardware to solve complex mathematical problems in order to verify transactions on the Bitcoin blockchain.
Renewable energy is the energy that powers Riot Blockchain’s mining facility.
Second, Bitcoin is the primary focus of Riot Blockchain. The company mines Bitcoin using its own equipment and the equipment of others.
As of September, 2023, Riot Blockchain owns approximately 7,264 Bitcoin’s. The company’s Bitcoin holdings are worth approximately $210 million at the current price of Bitcoin.
In second quarter of 2023, the company generated $76.7 million in revenue from its Bitcoin mining mining operations. This represents a 27% increase from the same quarter in 2022.
Chiefly, Bitcoin mining is energy – intensive process. The Bitcoin network uses a proof-of-work consensus mechanism, which requires miners to solve complex mathematical problems in order to verify transactions and earn rewards.
This process requires a lot of computing power, which consumes a lot of energy.
Secondly, this company is a Bitcoin mining company, so its operations are also energy-intensive.
Company has said that it is committed to using renewable energy to power its mining operations.
It has a goal of using 100% renewable energy by 2025. However, notably, though it uses 100% renewable energy,Bitcoin mining will still be an energy-intensive process.
The Bitcoin network is designed to be energy-intensive,and this is one of the reasons why it is secure.
It’s worth buying Riot if you believe in Bitcoin
It is safer to simply buy the crypto instead of investing in a miner like Riot. However, Riot’s stock could also outperform Bitcoin’s price if that happens. Because it will be mining more Bitcoins on its own.
In simple words, Riot is risky but it’s still worth buying at these bargain-bin levels if you believe in Bitcoin’s future.
Read More Stably USD-Bitcoin Network’s-BRC20
What is the Hash rate of Riot Blockchain?
As of September 8, 2023, Riot Blockchain’s hash rate is 10.7 exhash per second (EH/s).
This is the amount of computing power that the company ‘s bitcoin mining machines use to solve the complex mathematical equations that are necessary to add new blocks to the Bitcoin blockchain.
It has been steadily, increasing its hash rate over the past few years. In 2021, the company’s hash rate was 3.1 EH/s. In 2022, it reached all time high of 9.7 EH/s. And in 2023,the company’s is on track to reach its target of 12.6 EH/s.
This hash rate growth is being driven by a number of factors,.
a.Purchase of new mining machines from Bitmain and other manufacturers.
b. The expansion of its mining operations in Texas and other locations.
c. The increasing difficulty of mining Bitcoin, over time, which means that miners need more computing power to solve the equations.
A higher hash rate means that the company is more likely to mine Bitcoin successfully and earn more revenue.
However, it important to understand that the Bitcoin mining industry is volatile and the company’s hash rate could fluctuate in future.
Read More Bitcoin Lightning Network Platform?
What are the Risks associated with Riot Blockchain?
The future of Riot Blockchain is closely tying to the future of Bitcoin. If the price of Bitcoin continues to rise, the company’s profits will also rise.
And the, its future success will depend on a number of factors,including the price of Bitcoin,the availability of cheap electricity,and the regulatory environment.
a.The price of Bitcoin is volatile,and could decline sharply.
b. The company is heavily reliant on Bitcoin mining,which is an energy-intensive process.
c. The company exposes regulatory risks, as Bitcoin is still a relatively new and untested asset class.
The energy consumption of Bitcoin mining is a controversial topic,. Some people believe that it is a waste of energy, while others believe that it is a necessary part of the Bitcoin network.
The future of Bitcoin mining is uncertain. The regulatory environment could also change, making it more difficult to mine Bitcoin.
Overall, Riot Blockchain is a speculative investment that should only be considered by investors who are comfortable with high risk.
Many investors were initially skeptical of Riot’s plans, but its revenue has skyrocketed alongside Bitcoin’s rising prices as its stock price rallied nearly 1,000% over the past 12 months.
Read More Mining Pool-What Is Bitcoin Mining?
Riot Platforms Inc- Performance
It is a company that operates in the technology sector ,specifically in the field of blockchain and cryptocurrency.
Thereby, tying its stock performance to developments and trends in the crypto market.
The company is involving itself into the mining of cryptocurrencies such as Bitcoin,which see significant growth and adoption in recent years.
In terms of financial performance,Riot Platforms Inc reported earnings per share of -$0.18 for the current quarter.
This indicates that the company incurred a loss during this period.However,it is important to not that the cryptocurrency market can be volatile, and fluctuations in the value of can impact the earnings of companies involved in the industry.
Despite the loss in earnings, Riot platforms reported sales of $98.2 million for the current quarter.
This indicates that the company generated significant revenue during this period.
The company’s sales performance is a positive indicator of its ability to generate income and support its operations.
August was a landmark month for Riot in showcasing the benefits of our unique power strategy,” said Jason Les, CEO of Riot.
“Riot achieved a new monthly record for Power and Demand Response Credits, totaling $31.7 million in August, which surpassed the total amount of all Credits received in 2022.
Based on the average Bitcoin price in August, Power and Demand Response credits received equated to approximately 1,136 Bitcoin.
The effects of these credits significantly lower Riot’s cost to mine Bitcoin and are a key element in making Riot one of the lowest cost producers of Bitcoin in the industry.
Riot’s power strategy is a key competitive advantage, and when placed alongside our strong financial position and efficient miner fleet, put Riot in a leading position heading into the upcoming Bitcoin ‘halving’ event next year.”
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The Riot Blockchain is a risky investment, but it also has the potential to be very profitable.
The company’s future success will depend on a number of factors, including the price of Bitcoin, the availability of cheap electricity,and the regulatory environment.
Nasdaq Stock Exchange is listing the Company located in New York City. Ticker symbol “RIOT” the symbol using to present Riot Blockchain’s shares on the Nasdaq Stock Exchange.
Read More Blockchain Gaming- What Is The Future?
Riot platforms have 82.38% upside potential,based on the analyst’s average price target. Is RIOT a Buy, Sell or Hold? Riot platforms has a consensus rating of Strong Buy which is based on 8 buy ratings,0 hold ratings and 0 sell ratings.
Riot stock price stood at $11.35. It will hit $12 by the end of 2023 and then $15 by the middle of 2024. It will rise to $17 within the year of 2025, $20 in 2026.
Riot Platforms is a top-tier Bitcoin miner, and the future looks bright for blockchain-based business interests in the 2020s.
Riot Platforms.Inc. is a Bitcoin mining company engaged in the provision of special cryptocurrency mining computers. It invests in Verady,Coinsquare,and Tess.
In February 2011, Tencent invested $4000 million for 93% stake in Riot Games. Tencent bought the remaining 7% on December 16,2015, not disclosing the price.
You can not buy stock in Riot Games directly . Tencent Holdings ADR,as RIOT Games is a subsidiary of Tencent Holdings.