Anemic April earnings continue Beijing Bitmain's and Allrise Capital's Bitcoin Bust

Last month Bitcoin prices were at their highest point in a year, but those higher prices failed to translate into higher after-power revenue for Beijing's Bitmain and Allrise Captial from their massive bitcoin mining facility at the converted PNC paper mill site in Usk, WA. 

Public records obtained from the PUD indicated that Bitmain/Allrise only brought in around an anemic $375,000 in revenue during the month of April after paying their power bill. Given that Bitmain and Allrise collectively spent between $100 and $300 million to set up the largest bitcoin mining facility west of Texas at the Usk site and only have less than a year left to recoup their investment, April's earnings reinforce our analysis that the Beijing's project in Pend Oreille County has been a financial disaster. See Why the Usk Bitcoin Mine is a Financial Disaster for Bitmain and Allrise Capital at POC Cryptonomics - PROTECT PEND OREILLE

Last month Bitmain/Allrise paid $5,247,555.56 for 53,280 megawatt hours of electricity. (Note: only a small fraction of that amount actually went to our PUD). In return, Cascade Digital Mining, the joint-venture LLC between Bitmain and Allrise, was able to earn an average of 6.5 bitcoin each day at an average price of $28,833 per bitcoin.  That works out to around $5,6222,500 in total BEFORE-POWER-COST revenue. Subtract the cost of power and that leaves only around $375,000 in total AFTER-POWER-COST revenue for the month. 

That is not enough to ever pay off their sunk costs in the facility before the bitcoin machines fall apart, let alone before the pending bitcoin "Halving" event next April that will double the cost of competing for bitcoin (aka mining). For more on the "Halving" see Only A Year Away From Disaster: Beijing’s Bitmain and Allrise Capital’s Usk Bitcoin mine faces financial collapse next spring unless bitcoin prices explode - PROTECT PEND OREILLE

​Even though bitcoin prices were at an annual high, mining revenue still declined for two reasons. FIrst, the number of bitcoin the Usk facility can potentially earn each day has fallen by 30 percent since they began full-scale operations last September as more and more bitcoin miners are competing for a fixed number of bitcoin available each day. See It's counterintuitive-- Bitcoin prices are edging up, but that's a bad thing for Beijing Bitmain's/Allrise Capital's Usk bitcoin mining facility - PROTECT PEND OREILLE

Second, the price of market power must purchase most months of the year has remained stubbornly high. In April they paid an all-in price of $98.50 per megawatt hour, or 9.85 cents per kilowatt hour. More competitive industrial-scale miners in other parts of the country typically pay closer to 3 cents per kilowatt hour for their power. 

The higher market prices help explain why Beijing's Bitmain and Allrise Capital continue to be so aggressive in pressuring our PUD to make its other 9,600 customers subsidize their power costs.