Riot Ordered 42,000 Bitcoin Miners in $138.5 Million Expansion

Riot Blockchain announced on April 7, 2021, that it had contracted to buy 42,000 Bitmain S19j bitcoin-mining machines for $138.5 million. The Nasdaq-listed miner said the order would add an estimated 3.7 exahashes per second, or EH/s, to its existing and planned fleet and lift projected capacity to 7.7 EH/s after full deployment.

The announcement mattered because it converted the 2021 mining boom into a large, scheduled commitment for specialized hardware and future electricity. Riot’s 7.7 EH/s figure was 93% above its previous estimate of 4.0 EH/s by October 2021. It was a forecast, however, not computing power operating on the Bitcoin network on April 7.

Twelve months of planned deliveries

Riot said Bitmain would deliver at least 3,500 S19j machines each month from November 2021 through October 2022. Twelve monthly batches at that minimum equal the 42,000-unit order. The disclosed purchase price works out to approximately $3,297.62 per machine, a Coinburn calculation that excludes any shipping, installation, hosting or power-infrastructure cost not specified in the announcement.

Each S19j was rated by the companies at 90 terahashes per second, or TH/s, while drawing 3,100 watts. Multiplying those specifications by 42,000 produces 3.78 EH/s of nominal computing capacity and 130.2 megawatts of machine-level load for the new order alone. Riot described the added capacity as an estimated 3.7 EH/s, reflecting its presentation rather than a measured operating result. The electrical calculation also does not include cooling, conversion losses or other facility overhead.

After all planned machines were deployed, Riot projected a fleet of about 81,150 Antminers, 95% from Bitmain’s S19 series. The company estimated that the full fleet would consume approximately 257.6 megawatts and operate at an overall efficiency of 33 joules per terahash. Those were management estimates contingent on delivery and deployment.

Capacity was not the same as output

Hash rate measures the number of mining computations a fleet can attempt each second. More hash rate can raise a miner’s expected share of Bitcoin block rewards, but only in relation to the computing power of the entire network. Actual bitcoin production would also depend on network difficulty, uptime and pool performance. Financial results would further depend on bitcoin’s price, transaction fees, electricity expenses and other operating costs.

The long delivery window therefore created material execution risk. Machines had to be manufactured during a semiconductor shortage, shipped, installed at powered facilities and kept online. Riot said on April 7 that chip constraints and demand for mining hardware had made equipment scarce. That was the company’s contemporaneous assessment, not an independently quantified supply study.

A public-company scale bet

Riot said the new agreement brought its Bitmain purchase contracts since late 2019 to nearly $230 million. Its mining operations were then located at Coinmint’s facility in upstate New York under a co-location arrangement. The order showed how a publicly traded miner could reserve industrial-scale capacity far in advance, using corporate capital to compete for application-specific integrated circuits and power access.

The deal also concentrated risk. The economics could change between the April 7 announcement and the scheduled final October 2022 delivery. A larger network, weaker bitcoin price, higher power costs, delays or hardware failures could reduce the value of the planned expansion.

Bitmain confirmed the order on April 8, repeating the 42,000-unit quantity, $138.5 million price and delivery schedule. That next-day confirmation supports the transaction record but was not information available at the moment of Riot’s April 7 announcement. The event-day conclusion remains narrow: Riot had made a disclosed nine-figure hardware commitment, while almost all of the promised new capacity still lay in the future.