What happened
Actions of 3D sphere (NASDAQ: ANY) jumped 26% on Wednesday after its future merger partner Gryphon Digital Mining announced it had received a shipment of machines that will be used to explode Bitcoin (CRYPTO: BTC) in a carbon neutral manner. Shares of shares rose 35% in the news and have now risen nearly 400% so far.
And what
On Wednesday, Gryphon Digital Mining announced that it had installed its first batch of 7,200 S19J Pro Antminers and will continue to receive 600 machines monthly.
Image source: Getty Images.
How does this relate to Sphere 3D? Well, the company, which was originally a provider of cloud-based software, has gone on to try to exploit Bitcoin in an environmentally friendly way. To do so, it has agreed to merge with Gryphon Digital Mining. (The merger is not yet complete.)
To help fund purchases of Bitcoin mining equipment, Sphere 3D raises $ 192 million by selling common stock and collateral. Along with the 7,200 machines that Gryphon is installing, Sphere 3D plans to buy 60k cryptographic mining machines that will run on renewable energy.
Now that
Bitcoin mining is an exciting development for some investors, especially for those who are bullish on cryptocurrencies in general. But long-term key investors should stay away from Sphere 3D stocks.
The company has not released a quarterly report since November last year. In this report, it was clear that their software business was declining rapidly. This Bitcoin mining pivot should be a huge red flag and keep all investors away from Sphere 3D stocks right now.
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