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Iris Energy to cut back mining hardware after defaulting on a $108 million loan

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Australian bitcoin miner Iris Energy is the latest to suffer from crypto bear market pressure, losing a significant portion of its mining power after defaulting on a loan.

a filing By the company to the US Securities and Exchange Commission on November 21, it disclosed that it had separated its hardware used as collateral in a $107.8 million loan as of November 18.

The company noted that the units “generate insufficient cash flows to service their debt financing obligations.” The operation generates about $2 million in total bitcoin earnings per month but cannot cover debt obligations of $7 million.

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Iris has now reduced its capacity by about 3.6 EH/s (exahashes per second) of mining power. He stated that capacity remains at around 2.4 EH/s which includes 1.1 EH/s for rigs in operation and 1.4 EH/s for rigs in transit or pending deployment.

The company has stated that its “data center capacity and development pipeline are unaffected by recent events,” and it will continue to explore opportunities to leverage its capacity. Iris is also looking at the possibility of “using the $75 million in advance payments already made to Bitmain in connection with an additional 7.5 EH/s for contracted miners to further self-min.”

Earlier this month, the company Served with default notice For $103 million. Iris Energy primarily operates Canadian BTC mining centers that are powered entirely by renewable energy. In early August, the company Double your hash rate After activating the facilities in Canada.

Iris Energy (IREN) stock is down 18% on the day to trade at $1.65 in after-hours trading. It reached an all-time low on November 21, down 94% from its all-time high of $24.8 when it first traded in November 2021.

Related: Bitcoin miners are rethinking business strategies for long-term survival

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Bitcoin miners are currently experiencing a triple whammy of high hash rates, difficulty, high energy prices, and low bitcoin prices.

This causes many of them to either turn off their machines or start selling the asset. On November 21, Charles Edwards, founder of Capriol Fund, noted that the current rates of selling miners were the most aggressive in nearly seven years.

“If the price doesn’t go up soon, we will see a lot of bitcoin miners out of business,” he added.

This price increase is not likely to come anytime soon. Bitcoin slid to a fresh bear cycle low of $15,649 during the early hours of Asian trading on Tuesday, November 22, according to Queen Gekko.