(AUSTRALIA) – Daniel Roberts, co-founder of Nasdaq-listed bitcoin miner Iris Energy, has sounded an alarm about the precarious state of government debt in the global financial system, warning that it poses a severe threat to the post-pandemic global economy, potentially leading to a near-certain collapse.
Iris Energy, Australia’s largest homegrown bitcoin miner, recently reported a narrowed net loss of $US171.9 million ($267.2 million) for the financial year ending June 30, compared to a loss of $US419.8 million in the previous year.
Roberts argues that governments are now left with no choice but to resort to money printing to inflate away their debt burdens.
He views the world’s central bank-sponsored financial system as a collective delusion, where economic growth relies on increased debt and money printing.
“Governments are broke, they cannot pay their bills,” Roberts stated. “The only way they can pay their interest bill is printing more money, objectively, and mathematically it’s game over for Western economies.”
Iris energy faces stock decline despite EBITDA gains
Roberts believes that a collapse has already occurred, with the money supply growing by 8% year-on-year, and assets like property and the stock market merely keeping pace with the influx of new money, resulting in a surge in asset prices that he considers unsustainable.
While bitcoin, often seen as a risk and liquidity indicator, traded at $US26,280 during the reporting period, reflecting a 9.9% decline over the past month, Iris Energy has faced a substantial stock price drop since its peak during the cryptocurrency bubble in November 2021, falling by 84.2%. It was valued at $US4.43 per share on Thursday.
Despite the challenges, Iris Energy reported adjusted EBITDA of $US1.4 million in financial 2023, with bitcoin mining revenue rising 21.9% to $US75.5 million.
The company intends to reverse its stock market decline by investing in artificial intelligence chips and constructing new renewable energy-powered bitcoin mining facilities in Texas.
As of June 30, Iris had no debt and held $US69.1 million in cash, suggesting it has the financial capacity to support its growth plans, which could amount to $US626 million through an at-the-market (ATM) share issuance facility worth $US300 million and additional capital raised through share or debt issuance.