Riot Platforms Sells $38.8M Worth of Bitcoin to Address Liquidity Problems

Riot Platforms, the world's second-largest publicly traded Bitcoin miner, has sold $38.8 million worth of Bitcoin to address current liquidity problems.

According to the company’s latest financial statement, Riot Platforms (NASDAQ:RIOT) sold 475 Bitcoins for $38.8 million to adjust current liquidity.

The Castle Rock-based miner sold 463 Bitcoins mined in April and an additional 12 Bitcoins from company reserves. The move comes as the Bitcoin mining industry continues to face pressure from revenue declines and increased operational expenses.

The holding sold at an average cost of $81,731 per Bitcoin. The funds will go towards company expansion and operations to reduce dependence on equity capital.

Earlier this week, the company’s mining difficulty experienced a 35% year-over-year (YoY) growth in April.

The company’s hash rate remained stable but its Bitcoin production saw a 13% decrease. In April, the company produced 463 Bitcoins, down from 533 Bitcoins produced in March.

The drop in Bitcoin production rates results from the 2024 Bitcoin halving event and increased difficulties to solve Bitcoin mining puzzles.

After April’s production was sold to strengthen the company’s balance sheet, no new equity capital will be used.

At the time of writing, the firm’s remaining Bitcoin reserves are valued at 19,211 BTC, or about $1.8 billion at current market prices.

The company’s stock saw a 6% decrease to $7.90 on Thursday.

Institutional Bitcoin Demand

The company’s 475 Bitcoin sale comes amid increased institutional interest in Bitcoin.

As reported by BlockMango, investors poured $5.5 billion into seven new spot Bitcoin ETFs launched in the last three weeks.

However, despite high institutional demand for BTC, the company’s move could hurt long-term investor confidence.

Moreover, a separate transaction saw Riot transfer $6.7 million worth of Bitcoin to NYDIG, a trusted institutional crypto custodian to manage liquidity.

The transaction has sparked market speculation about the firm’s future Bitcoin sales.