Company: CIFRW
Filing Date: 2025-02-25
Form Type: 10-K
Source: 0001819989-25-000005
Chunk: 146

Company: Cipher Mining Inc.
Filing Date: 2025-02-25
Form: 10-K
Item: Item 1A
Chunk 146
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 mechanical failures, which could severely disrupt the normal operation of our business and adversely affect our results of operations.” Texas, through its regulatory and economic incentives, has encouraged bitcoin mining companies, like ours, to locate their operations in the state. As such, we face increased competition in Texas for suitable bitcoin mining data center sites and skilled workers. Additionally, if the regulatory and economic environment in Texas were to become less favorable to bitcoin mining companies or HPC, including by way of increased taxes, our heavy concentration of sites in Texas means our business, financial condition and results of operations could be adversely affected. 

We depend on third parties, including electric grid operators, electric utility providers and manufacturers of certain critical and specialized equipment, and rely on components and raw materials that may be subject to price fluctuations or shortages, including ASIC chips that have been subject to periods of significant shortage and high innovation pace. 

We depend on third parties, including electric grid operators Oncor Electric Delivery Company LLC (“Oncor”) and American Electric Power Company, Inc. (“AEP”) , the Texas electric utility ERCOT, and manufacturers of critical components for our mining equipment and our data centers, which may be subject to price fluctuations or shortages. For example, our bitcoin mining operations require approval to operate from Oncor, AEP and ERCOT, which can be onerous to obtain. If Oncor, AEP or ERCOT delay in providing such approval, or change the requirements to operate bitcoin mining facilities, our business plans may be disrupted and our results of operations may be negatively affected. 

We are also reliant on critical equipment to supply power to our bitcoin mining operations at our data center facilities and we are exposed to the risk of disruptions or other failures in the overall global supply chain for bitcoin mining and related data center hardware. See also “—Any unfavorable global economic, business or political conditions, such as geopolitical tensions, military conflicts, acts of terrorism, natural disasters, pandemics, trade restrictions, tariffs, or similar events could adversely affect our business, financial condition and results of operations.” This is particularly relevant to the ASIC chip production since there is only a small number of fabrication facilities capable of such production, which increases our risk exposure to manufacturing disruptions or other supply chain failures, but it also applies to other infrastructure hardware necessary for operating our data centers, such as transformers, cables, and switch gear.  If this critical equipment malfunctions or we have delays in the ability to fix such equipment, it could adversely affect our operations and financial results. Similarly, our operations are