Bitcoin is ‘dirt cheap’: Nasdaq-listed miner says, highlighting the Trump-fuelled rally is far from over

Former Macquarie banker turned bitcoin miner Dan Roberts says the price of the cryptocurrency is “dirt cheap” despite it recently topping $150,000 for the first time.

Iren founders Will (left) and Daniel Roberts. Picture: Stephen Cooper

Former Macquarie banker turned bitcoin miner Dan Roberts says the price of the cryptocurrency is “dirt cheap” despite it topping $150,000 for the first time last week after Donald Trump vowed to become the first “crypto president”.

Mr Roberts who founded Nasdaq-listed Iren – formerly known as Iris Energy – with his brother William is bullish about bitcoin’s outlook, despite suffering an 8.7 per cent slump in mining revenue in the three months to September 30.

But the company’s share price surged 29.7 per cent to $US12.40 ($19.07), almost returning to its two-year high reached in July, after it said it may pay a dividend next year.

And Mr Roberts says several court cases against the company – including a $US100m unpaid debt and US investor class action over “alleged securities fraud” – “is not something that gives us great concern”.

New York-based law firm Levi & Korsinsky is acting on behalf of investors, alleging that Iren “made false statements” and overstated its “prospects with data centres and high performance computing”.

“I don’t know how many have actually made it to court, to be fair, but before we listed we were told it was part of the landscape of being listed in the US,” Mr Roberts said.

“It’s not something that occupies a huge amount of our time and we won’t comment directly on other than to say I think you’ve seen everyone today be dismissed.”

Iren is appealing a separate legal bid involving a $US100m loan from crypto funder Nydig, which Iren’s subsidiaries based in Canada used to buy about 36,400 computers and install them in warehouses in British Columbia. But the price of bitcoin crashed after the install and the Canadian companies collapsed.

Donald Trump has vowed to become the first ‘crypto president’ and create a bitcoin reserve.

Nydig has lost two attempts in Canada to make Iren liable for the loan and is now pursuing Iren in Australia’s courts.

Mr Roberts declined to comment on the case but said: “The transaction and the economic environment didn’t play out the way the lender had hoped. They lost an appeal in Canada. It’s not something that gives us great concern to be honest”.

Instead, he is focusing on Iren’s growth, which includes diversifying into data centres to capitalise on the artificial intelligence boom, as well as becoming a more efficient bitcoin miner.

Its AI Cloud Services revenue surged 28 per cent to $3.2m in the three months to September 30 versus the June quarter. Bitcoin revenue, however, slumped to $49.6m from $54.3m, with Mr Roberts citing an “increase in network difficulty and lower bitcoin prices”.

Adjusted earnings before interest, tax, depreciation and amortisation fell to $2.6m versus $12.2m the previous quarter. The company is now looking at “alternative funding instruments”, which Mr Roberts said combined with “strong operating cashflows” would enhance Iren’s “flexibility to support potential distributions in 2025”.

He said Iren was an efficient producer, mining bitcoin at $US29,000 a coin in market where it was worth $US90,000.

Mr Roberts said Mr Trump’s vow to establish a bitcoin reserve would also support prices.

“If the US indeed does what they’re saying they’re going to do, what Trump promised pre-election and accumulate, I think it was a million bitcoins, 5 per cent of the overall supply, what is going to happen to the long term prospect, let alone the short term price movements in bitcoin? And all of a sudden, it sets off this tidal wave and this snowball effect where the longer and slower you are to adopt it, the worse off you’re going to be as an individual, nation and company,” Mr Roberts said.

“And the reality is, bitcoin is cheap. Bitcoin is dirt cheap relative to the end state of where it probably goes. I mean gold parity today – if you look at the valuation of all gold and compare it to the valuation of Bitcoin divided by 21 million – then to hit gold parity, bitcoin needs to hit $US800,000, $US900,000 a coin, and it’s scarcer, more divisible, more durable than gold is. So there’s an air of inevitability around all this, and when you’ve got a 10x movement just to hit gold, you can see how this really might catch on.”

JP Morgan analyst Reginald Smith said while Iren’s bitcoin mining revenue “declined modestly”, citing network hashrate growth, cash operating expenses “remains in check, which stands in contrast to other publicly traded miners”.

“Operations continue to run smoothly, and management floated the possibility of returning capital to shareholders in 2025, which came as a new and welcomed disclosure,” Mr Smith wrote in a note to investors.