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Argo Blockchain (ARGO), the mining company that diversified into Web 3 through its Argo Lab subsidiary earlier this year, said on Wednesday it had a stake in UST that wasn’t material and was able to “nearly break-even” on its position during the UST meltdown.
“We weren’t super heavily invested in the Terra ecosystem,” said Argo’s CEO Peter Wall during the company’s first-quarter earnings conference call. “We did have some UST, we were participating in yield generation on the Anchor protocol,” he added.
Argo was one of the first publicly traded crypto mining companies to form a non-mining business unit called “Argo Labs.” The subsidiary was created in January with a goal of diversifying Argo’s business and taking advantage of other opportunities in the blockchain ecosystem. Currently, Argo Lab’s investments include Polkadot's DOT, ether (ETH) and Solana's SOL, according to the company’s first-quarter presentation.
Argo was able to sell its UST positions at 93 cents per token before the price fully collapsed, according to Wall. Most recently, UST was still trading around 10 cents according to CoinDesk’s price index. “Looking back [selling at that level] was a very good move given last time I checked it was trading around 12 cents,” Wall said during the call. “Overall, on a net basis, in the Terra ecosystem, we nearly broke even on our positions, after taking into consideration the yield that we generated through our holdings,” he added.
Last week, Terra’s LUNA token fell 99.7% in value as the U.S. dollar-pegged algorithmic stablecoin terraUSD (UST) lost its peg and dropped to under 10 cents, causing an outflow in funds from the Terra ecosystem and declining sentiment for the project among the crypto community.
The collapse of the Terra ecosystem has taken a toll on numerous large-scale as well as retail investors. On social media and message boards, former LUNA backers have reported huge losses, despair and hopelessness.
Argo Blockchain reported its first-quarter earnings on Wednesday, in which its net income tumbled but revenue rose year over year, and it reiterated its hashrate guidance of 5.5 exahash per second (EH/s) by the end of 2022. The shares of the miner traded down about 4% in the U.S. on Wednesday, keeping pace with that of other publicly traded crypto miners.