A $22.9 million capital deficit threatens to derail an energy firm’s pivot to off-grid Bitcoin mining

Olenox Industries is an energy company that acquired Bitcoin miner CS Digital Ventures in May. It reported preliminary July production of 15.13 BTC against a June 30 balance sheet. The balance sheet carried $1.21 million of cash and $26.26 million of current liabilities.

However, the output had a gross value of about $1.16 million at the Aug. 21 Bitcoin spot price of $76,371.25. It was not equivalent to disclosed revenue, sale proceeds or available cash. For part of the fleet, Olenox received the full Bitcoin output. It still owed a hosting invoice for power, management fees and profit share that had not been finalized.

Operationally, Olenox recorded 1.02 EH/s of average operational hashrate, equal to 64% of the fleet’s economic capacity. The company cited summer heat, low-power-mode operation and normal equipment availability. All three operating figures were preliminary and unaudited.

Meanwhile, the Aug. 19 quarterly filing put the production number in sharper relief. Olenox had $3.40 million of total current assets at June 30, leaving a working-capital deficit of about $22.9 million.

Importantly, its current liabilities were not all debt immediately due. They included $14.55 million of accounts payable and accrued expenses. Other items included lease current maturities, amounts due to affiliates, credit lines, derivative liabilities, convertible notes, short-term notes and current maturities of long-term debt.