With “the Bitcoin halving” fast approaching, more and more companies are shifting their focus to Bitcoin mining.
Riot Blockchain, a Nasdaq-listed crypto mining and investment company, announced on Thursday that it will be realigning its business strategy this year. The company plans to sell off its cryptocurrency exchange RiotX and instead target its efforts almost entirely on Bitcoin mining. Riot cited changes in the “regulatory environment” and “cybersecurity risks” as reasons for ceasing the exchange.
Riot Blockchain Outlines 2020 Strategic Priorities - Focus on Bitcoin Mining #crypto #bitcoin #bitcoinmininghttps://t.co/HVVzmoVoAX
— Riot Blockchain (@RiotBlockchain) February 20, 2020
As part of the announcement, Riot said it has partnered with financial services firm XMS Capital Partners to help it “navigate the dynamic bitcoin landscape and advise the Company on potential strategic transactions in bitcoin mining related operations." Riot had also previously worked on mining other cryptocurrencies like Bitcoin Cash (BCH) and Litecoin (LTC).
Following the announcement, Riot’s stock dropped as much as 5 percent. It has since recovered somewhat, currently trading for around $1.41 per share—though it is still down more than 13 percent over the last five days.
Riot Blockchain did not immediately respond to Decrypt’s request for comment.
76 days left until next #BitcoinHalving
— Bitcoin Halving Countdown (@Bitcoin_Halving) February 21, 2020
The timing of Riot’s realignment is likely not coincidental, with the Bitcoin halving set to occur sometime in May. The halving refers to block mining rewards from the Bitcoin network decreasing from 12.5 to 6.25 bitcoins. While hardly unanimous, many market analysts believe the halving could result in an increase in Bitcoin’s price.
Riot announced earlier this month that it is expanding its Bitcoin mining facility in Oklahoma City, which houses crypto mining equipment from Chinese mining giant Bitmain. The company also recently escaped a lawsuit from the US Securities and Exchange Commission (SEC), which was investigating the company after it had pivoted from biotech to crypto in 2018.
This latest announcement is part of a growing trend of blockchain companies focusing on Bitcoin mining in the American Midwest. Yesterday, Peter Thiel-backed Layer 1 opened a Bitcoin mining facility in Texas. Northern Data AG and Whinstone US are also building a Bitcoin mining facility and datacenter in the state. And last year, Bitmain opened a Bitcoin mining farm in Rockdale, Texas.
As the halving draws nearer, how many more companies will shift their attention to the competitive Bitcoin mining industry?