2024

Bitcoin

April

Bitcoin mining firm IREN, formerly known as <a href="https://ultramining.com/news/en/iris-energy-diversifies-into-ai-with-10-million-nvidia-gpu-purchase-amid-bitcoin-focus/" rel="noopener noreferrer nofollow">Iris Energy</a>, experienced a significant drop of 24% on the Nasdaq after a scathing report from short-seller firm Culper Research. The report criticized IREN as “wildly overvalued” and claimed it was not investing sufficiently in the high-performance computing (HPC) sector, according to <a href="https://cointelegraph.com/news/bitcoin-miner-iren-falls-24-percent-after-short-seller-report" rel="noopener noreferrer nofollow">Cointelegraph</a>.
Culper Research, which disclosed its short-selling position on IREN, accused the company of boasting about its HPC plans while investing far less than necessary. According to Culper, IREN has spent less than $1 million per megawatt to build its existing center, whereas the true cost to develop an HPC-ready data center is estimated to be around $10 to $20 million per MW.
“To analogize, IREN claims that it’s set to win the Monaco Grand Prix, but just arrived to the track in a Toyota Prius,” Culper stated in its report.
The short seller also claimed IREN is overvalued and should be 52-79% cheaper. They highlighted IREN’s high enterprise value relative to its <a href="https://ultramining.com/news/en/bitcoin-miners-set-for-a-tough-ride-as-2024-halving-nears-jp-morgan/" rel="noopener noreferrer nofollow">hash rate</a> on a MW basis compared to other publicly traded miners. The report noted that IREN has historically burned cash and that the last bitcoin <a href="https://ultramining.com/news/en/heat-waves-and-halving-bitcoin-miners-cash-in-amid-rising-prices/" rel="noopener noreferrer nofollow">halving</a> event further weakened miner economics.
Culper also pointed out that IREN failed to meet its promise of attaining a hash rate of 10 exahashes per second (EH/s) by April 2023, only reaching 5.5 EH/s by that time. Insider selling of shares by the firm's co-CEOs, brothers Daniel and Will Roberts, since February 2024 was also highlighted.
IREN’s shares fell to $10.36 on July 11 before partially recovering to $11.20 by the end of trading, according to Google Finance data. The company’s market cap now stands at $2.09 billion.

Bitcoin Miner IREN Plummets 24% Following Damning Short Seller Report

Ultramining_Eng

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