White Rock Management CEO Andy Long believes that bear markets “present excellent opportunities” for expansion through M&A in the crypto mining sector..
Speaking to Cointelegraph, the CEO of the cryptocurrency mining company noted that companies that have managed their balance sheets effectively are in “great shape” during this bear market, and will continue to do well even if there is more volatility ahead.
“The bear market has presented challenges for miners who were leveraged at the top of the market, however, the sector has been through this before, and well capitalized and efficient miners will do just fine,” he said..
Long suggested that the current downtrend will provide key M&A opportunities for these companies.as they will have shown investors that they can survive extreme market conditions:
“Bear markets present excellent opportunities, so we expect to see mergers and acquisitions and consolidation activities in the mining sector involving both public and private players, to realize economies of scale and combine complementary operations.”
“We will also see that network growth will pick up, not to the level forecast by the end of the year, but likely by the end of the year to be at least 20% higher,” he added..
Long also noted that the Texas mining sector has performed well despite the current heat wave, highlighting the sector’s effective coordination with the Electric Reliability Council of Texas (ERCOT) to overcome power supply issues over the past two months:
“There is a lot of activity in Texas and the mining sector is in great shape. Grid-connected miners are working with ERCOT to provide demand responses during challenging times, and we anticipate continued growth across the state.”
White Rock is a Swiss-based cryptocurrency mining company that claims to have a plant of about 24 megawatts installed..
In June, it announced plans to expand its operations to the United States, starting with Texas.. As part of this move, White Rock has partnered with Natural Gas Onsite Neutralization (NGON) to operate their facility, which uses “environmentally responsible” methods to mine Bitcoin (BTC).
As reported on July 11, Mining companies including Riot Blockchain and Core Scientific shut down parts of their Texas mining operations in June to reduce stress on the power grid after temperatures topped 100 degrees..
Both were proactive in easing the pressure on Texas’ energy supply, but another contributing factor was that energy prices had skyrocketed amid the heat wave.
As a result of this measure, the companies suffered a reduction in mining productivity. However, with the price of BTC gaining 14.7% in the last month and temperatures looking set to drop slightly to around 90 degrees Fahrenheit, there is a feeling that miners will turn their machines back on as the profitability of BTC mining will be too good to ignore.
“The rise in the price of bitcoin has led to increased profitability for miners and some miners who were pushed offline in June and July have probably plugged their machines back in,” Jaran Mellerud noted.a crypto mining analyst at research firm Arcane Crypto, in an interview with Bloomberg on Friday.
The price of bitcoin is at USD 23,088 at the time of writing this article.
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