Riot Blockchain files prospectus to sell up to $500M in new stock

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Block reward mining firm Riot Blockchain (NASDAQ: RIOT) has filed a prospectus with the U.S. Securities and Exchange Commission (SEC) to sell up to $500 million in common stock.

In its filing, the company detailed that it would be selling the stock from time to time as it deems fit in an “at the market” offering. The prospectus is part of a shelf offering, and Riot doesn’t plan on selling the stock immediately. The offering will be underwritten by Cantor Fitzgerald, B. Riley Securities, BTIG, Roth Capital Partners, D.A. Davidson, Macquarie Capital (USA) and Northland Securities.

At present, Riot has about 117 million outstanding shares. Once it sells the $500 million worth of stock, this figure will hit $139 million as at today’s share price. 

On the use of the funds, Riot stated, “…we intend to use the net proceeds from this offering for general corporate purposes, which may include, among other things, additions to working capital, satisfaction of corporate obligations, capital expenditures, strategic acquisitions, and investments in existing and future Bitcoin mining projects, and repurchases and redemptions of our common stock.”

Riot focuses on mining BTC and it holds most of what it mines. Since it doesn’t generate any revenue in fiat terms, it has to issue equity to raise capital to fund its operations and for any other expenses, including expansion and acquisitions.

As of March 1, the company held 5,783 BTC worth $264 million at press time.

Riot’s main operations are in Texas, where it projects to have over 80,000 Antminer mining rigs by the fourth quarter of 2022, which would generate 7.7 exahash per second in mining power, making Riot one of the biggest block reward miners globally.

While it has scaled up operations in 2022, a winter storm in February in Texas threatened to derail its operations. The company announced that it had shut down 99% of its power in its Texas site as electricity demand soared in the Lone Star State.

In its most recent filing with the SEC, Riot revealed that it’s losing its chief operations officer Megan Brooks-Anderson effective April 7. 

Watch: CoinGeek New York panel, How to Achieve Green Bitcoin: Energy Consumption & Environmental Sustainability