Bitcoin miner Iris Energy hopes to raise $US215 million in its Nasdaq IPO, according to documents filed with the US exchange, marking the second Australian crypto miner to head overseas in as many months.
Iris Energy, based in Sydney and founded by Young Rich listers Dan and Will Roberts, is set to offer stock at between $US25 and $US27 a share, valuing the company at around $US1.5 billion ($2.1 billion).
Iris Energy, which currently has an operating asset in Canada, plans to use the fresh capital to buy new mining machinery and further develop its data centres across Canada, the United States and the Asia-Pacific.
The company attracted headlines after the Roberts brothers replaced ex-Transgrid executive Jason Roberts as Iris Energy co-chief executives after just a few months in September.
This year, Iris has changed its plans from an ASX-listing to a direct listing in the US, and now to an IPO.
The Roberts brothers are unable to comment on the business as they are under a SEC-induced ‘black out’ period, but are set to reap a $430 million stake in the floated business which could begin trading as soon as Thursday.
Iris pitches itself as a renewable energy-powered miner, situating itself next to large renewable energy plants which generate excess capacity.
Bitcoin miners can soak up the excess power when needed and turn off during peak times, offering stability to energy grids undergoing lumpy transitions from baseload coal generation.
According to the prospectus, Iris Energy booked an after tax loss of $678.7 million for the three months ended September 30, 2021. This compares with an after-tax loss of $500,000 for the same period a year earlier.
EBITDA jumped to $8.3 million in the September quarter, a sharp turnaround from the EBITDA loss of $300,000 a year earlier. Unlike other bitcoin miners, Iris Energy does not hold bitcoin on its balance sheet, instead frequently liquidating the cryptocurrency.
Iris Energy has been mining bitcoin since 2019 and has received at least $US795 million in equity, convertible notes and debt from investors including Regal Funds Management.
Iris Energy’s Canadian mine buys energy from the British Columbia Hydro and Power Authority. The data site has a 30-megawatt capacity.
Iris Energy’s plan to hit the Nasdaq trading boards comes after rival Mawson Infrastructure began trading on the US exchange in August, citing the ASX’s reluctance to list crypto-related businesses.
But as it stands, there is no guidance around bitcoin mining businesses.
The global market for bitcoin mining is currently reorganising, with the recent bans on mining in China prompting a wave of hashpower to drop off the network while those operators look for a more suitable location.
The market value for mining depends on the price of bitcoin, since the majority of value going to the miner is a function of the current bitcoin reward rate of 6.25 Bitcoin per successfully mined block.
At a price of $US50,000 per Bitcoin, the annual mining rewards for the entire industry would be approximately $US16.425 billion, according to the Iris Energy prospectus.