Abu Dhabi-listed Phoenix Group has taken a significant step forward by launching a 25-megawatt cryptocurrency mining facility in Willamette, South Carolina. This new site enhances the company’s global mining capacity to an impressive 18 exahash, underscoring Phoenix Group’s commitment to expanding its footprint in the cryptocurrency mining industry.
The Willamette facility isn’t just about increasing capacity. It’s also a strategic move to optimize and upgrade Phoenix Group’s proprietary mining technology. Seyed Mohammad Alizadehfard (Bijan), Co-Founder and Group CEO, highlighted the facility’s role in deploying these technological advancements. “The Willamette site enables us to deploy upgrades to our proprietary mining technology and optimize miner allocation for greater efficiency,” Alizadehfard said.
This new addition marks Phoenix Group’s tenth mining facility, spanning across the US, Canada, CIS, and the UAE. Each of these facilities is dedicated to one of Phoenix Group’s four core verticals: mining, hosting, trading, and investments. Alizadehfard emphasized that the expansion is part of a broader strategy to prepare for future demands in the blockchain space, ensuring the company remains agile and well-positioned for ongoing technological advancements and market growth.
Phoenix Group has had a remarkable year. Following its IPO on the Abu Dhabi Stock Exchange, the company reported a 50% growth in net income and a 20% year-on-year increase in sales. Their hosting business alone saw an astounding 119% growth, while their self-mining operations experienced a 480% year-on-year increase.
In January, Phoenix Group acquired $187 million worth of mining equipment from Bitmain Development PTI Limited. This acquisition, facilitated through Cypher Capital DMCC, reflects the company’s ongoing investment in cutting-edge technology. Additionally, Phoenix Group partnered with Whatsminer in December, securing a $380 million deal for hydro cooling hardware equipment. This advanced technology uses a closed-loop water system to enhance heat transfer efficiency, preserving water volume and quality.
While Phoenix Group is expanding, the broader Bitcoin mining industry faces significant challenges. Recently, miners have been experiencing a phase known as “capitulation,” where profits diminish due to a sell-off in the Bitcoin market. This often leads miners to reduce operations or sell a portion of their mined Bitcoin to sustain their activities. A key indicator of this trend is the decline in Bitcoin’s hashrate, which has dropped by 7.7%, reaching a four-month low of 576 EH/s. This decline mirrors conditions seen after the collapse of FTX in December 2022, suggesting a potential market bottom.
Miners have also been underpaid during this period, with daily revenues declining by 63% since the Bitcoin halving event. This event, which reduces the reward for mining new blocks, has significantly impacted the profitability of mining operations.
Despite these challenges, Phoenix Group’s strategic investments and expansions position it well for the future. The company’s commitment to technological innovation and efficient operations will likely help it navigate the volatile market conditions. Additionally, as other industry players like HIVE Digital Technologies expand their operations, the competitive landscape of cryptocurrency mining continues to evolve, promising further advancements and opportunities in the sector.
