Bitcoin miner Iris may open SPAC season in Australia

The Sydney Bitcoin mining firm has been approached by several specialized M&A companies for a deal that could be registered in the US and will raise $ 300 million to $ 500 million.

Iris is considering options such as traditional or direct listing on the Australian Stock Exchange or the Nasdaq. Discussions are ongoing and the company has yet to decide where to list.

SPACs are bogus businesses. They are not engaged in any activity, and are created specifically for the subsequent merger with a satrap who wants to be listed on public stock. According to data obtained by Bloomberg, the SPAC market reached $ 83 billion last year, about 46% of the record 2020 IPO volume in the US.

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ASX does not permit mergers with SPAC companies, so so far no Australian company has merged with any of them.

Iris Energy co-founder and director Daniel Roberts said the company is looking to go public and is considering several listing options. The operator can also initiate another round of funding first.

“We are currently negotiating with potential investors in order to carry out another stage of financing in the near future to attract private capital. This will bridge the open market, ”Roberts said in a telephone interview.

In March, the company’s collected funds increased by A $ 20 million ($ 15.5 million) amid strong demand from investors – ahead of the first sale of shares in the middle of this year. The round was extended, which eventually raised A $ 110 million, Roberts said.

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At gunpoint

The funds from the March fundraising were used to build a 50-megawatt data center in British Columbia, Canada, in addition to the 30-megawatt project, the company said. Judging by the data from the company’s website, equipment for mining bitcoins operating on renewable energy sources has been installed at the facilities. Most of British Columbia’s electricity comes from hydroelectric power plants.

Bitcoin is gaining more and more attention due to the amount of energy consumed in its creation, especially in regions where electricity is generated by burning fossil fuels such as coal. Digiconomist estimates that the annual carbon dioxide emissions from bitcoin mining are comparable to Sweden’s.

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Iris’ electricity providers use renewable energy sources, Roberts said. In addition, the company entered into agreements with them to reduce mining volumes and redirect electricity to regional networks during periods of peak consumption.

“We can sit and speculate that clothes dryers and tree lights are a waste of energy, but ultimately the market decides where to direct the energy and chooses Bitcoin,” Roberts said. “We are wondering how the market should be serviced to promote energy transition and employment in the region.”

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