Riot Blockchain Continues Massive Mining Rig ProcurementsAuthor: Jimmy AkiLast Updated: 04 June 2020 Crypto mining firm Riot Blockchain appears to be in the midst of a purchasing spree, as the firm recently splurged on new mining gear. Yesterday, the NASDAQ-listed firm purchased 1,000 Antminer s19 Pro mining rigs from manufacturer Bitmain, at a total cost of about $2.3 million, per its press release.Scaling Up Its Operations Post-HalvingThe news source confirmed that this is the second time in as many months that Riot will be purchasing a large inventory of miners. Last month, the firm reportedly spent another $2.4 million on 1,000 similar mining rigs. According to the company, the new inventory, combined with its existing rigs, will help it achieve a total operating hashrate of about 567 petahashes per second. All of these should consume about 14.2 megawatts of power too.The firm is also anticipating that it will receive the new miners by the second half of the year. They will be responsible for generating as much as 56 percent of the company’s total compute power.Riot’s move is coming on the heels of the Bitcoin halving, which has caused a paradigm shift in the mining space. With the mining rewards falling from 12.5 BTC to 6.25 BTC, miners and mining companies will need to switch to gear that can help them to reduce electricity costs as much as they can.The company’s investment will push its average hashpower by 467 percent over the same figures last year, while its power consumption will only increase by 50 percent. That seems like a fair gamble, and it could help the company to scale up its operations significantly. Riot’s Concerning Company FundamentalsRiot’s investment is a big bet on the mining space, and it is coming at a time when the company appears to need steady cash flow. Last month, the firm published its financial results for the first quarter of the year with the Securities and Exchange Commission (SEC). The report showed that mining revenue stood at $2.4 million, up from $1.4 million in Q1 2019.However, the financial report also showed some alarming signs. For one, Riot explained that it had mined fewer cryptocurrencies in Q1 2020, compared to the same period last year. As it showed, the firm mined 280 BTC this year, compared to 330 BTC in 2019. So, Riot’s increased revenues came from the higher price of Bitcoin this year compared to the same period last year. Another alarming sign came from the fact that the firm has been relying significantly on debt and equity financing to bankroll its operations. While the firm made $955,000 in profits for the quarter (compared to a loss of $65,000 in Q1 2019), the report also showed that the firm accumulated a deficit of over $221 million.Even worse, the firm explained that it expects to continue racking up losses in the near-term from its operations. It added that the losses could come from administrative and legal costs, as well as acquisitions and other business expenses. With these expenses continuing to mount, it’s only a matter of how high they can go.