League of Legends founding company Riot acquires Block Mining for $92.5 million, becoming the second largest publicly traded mining company in the United States

Riot Platforms Inc. has announced a strategic acquisition of Block Mining, a Kentucky-based Bitcoin miner with substantial power capabilities.

This move aims to enhance Riot’s mining power and diversify its power supply, significantly increasing its capacity to over 2 gigawatts (GW). JPMorgan analyst Reginald L.

Smith highlighted this acquisition as pivotal for Riot, making it the second-largest U.S.-listed miner by power capacity.

Riot Games’ $92.5 million bet

Riot is investing $92.5 million in this acquisition, with $18.5 million paid in cash and $74 million in stock. Smith detailed that Riot paid $1.5 million per energized megawatt (MW) and approximately $1 million per contracted MW.

This investment secures significant power resources for Riot, including two data centers in Kentucky, expected to support up to 305 MW by the end of 2025.

Expansion Plans and Facility Details

The acquisition includes control over several key facilities:

• Commerce Drive Facility in Paducah: Currently 35 MW, with plans to expand to 100 MW.
• Blue Steel Site in Calvert City: Currently 25 MW, with potential growth to 55 MW.
• Coleman Road Site: A greenfield site offering between 60-150 MW, expected to be operational by late 2025.

Riot Games’Hashrate Ambitions

This acquisition is a significant step towards achieving Riot’s ambitious hashrate targets. With 22 exahashes per second (EH/s) already online, Riot plans to increase its hashrate to 36.3 EH/s by the end of 2024 and 56.6 EH/s by the end of 2025. This marks a substantial rise from its previous goals of 31.5 EH/s and 40.8 EH/s, respectively.

Strategic Diversification Beyond Texas

Riot’s expansion beyond Corsicana, Texas, indicates a strategic shift aimed at strengthening its position in the industry.

Smith noted that this move was unexpected, given the potential for expansion at Corsicana, yet it positions Riot as a leader with the second-largest capacity among U.S.-listed miners.

Market Impact and Future Prospects

By securing additional power sources and enhancing its mining capabilities, Riot Platforms is poised to reshape the crypto-mining landscape and assert its dominance in the market.

This acquisition not only boosts Riot’s power and hashrate but also diversifies its geographic footprint, reducing dependency on a single location and mitigating risks associated with regional disruptions.

Conclusion

Riot Platforms Inc.'s acquisition of Block Mining is a bold strategic move that significantly enhances its mining capacity and diversifies its power supply.

With increased hashrate targets and expansion plans, Riot is set to become one of the top players in the U.S. crypto-mining industry.

This acquisition underscores Riot’s commitment to solidifying its position as a leading Bitcoin miner and leveraging strategic investments to drive growth and innovation in the cryptocurrency sector.