Kerrisdale Capital sent a complaint about crypto miner Riot Platforms to Texas officials over concerns related to safety hazards and equipment imported from ChinaThe company made the complaint in a on June 5 letter addressed to Navarro County Texas Judge H.M. Davenport Jr. and four commissioners.Kerrisdale cited a former operations specialist at Riot’s Rockdale facility who described dangerous spills, unsafe electrical equipment, and a lack of protective equipment use.The former employee said that management did not care about his safety concerns.Kerrisdale noted that in 2022, Riot used ExxonMobile’s Spectrasyn 2C as an immersion coolant, a product that ExxonMobile does not list for use in data centers.It said ExxonMobile has since launched products aimed at data center use and urged officials to determine which coolant Riot currently uses at its Rockdale and Corsicana centers.Kerrisdale also raised concerns about a $453 million purchase agreement for mining equipment from the Chinese manufacturer MicroBT.Riot allegedly claimed that the purchase would create jobs because Pennsylvania facilities would manufacture the mining devices. However, based on images obtained by Kerrisdale, the US facilities assembled parts imported from China.Kerrisdale added that MicroBT’s US manufacturer, Synos Corp., is highly automated and has few positions for highly skilled workers. It alleged that MicroBT primarily intends to bypass import tariffs rather than employ US workers through Synos.Kerrisdale disclosed a conflict of interest on all issues, stating that it has taken up a short position on Riot’s stock and will realize gains if Riot stock decreases in value.In a separate investment report, Kerrisdale criticized Bitcoin mining more broadly, calling it “easily among the worst business models” and alleged that Riot has never produced positive cash flows.The company also commented on mining’s impact on the Texas electrical grid, writing:“We believe Riot investors are oblivious to shifts in state and local politics and headline risk as we approach another summer which will test Texas’ fragile electric grid.”Kerrisdale linked a Dallas Morning News report stating that heightened summer demand is linked to air conditioner use. Prices are expected to rise over the summer.Texas was the subject of another mining and energy-related issue earlier this year. In February, the Texas Blockchain Council (TBC) and Riot challenged an executive order that would have required mining firms throughout the US to report energy use in detail.The government agencies largely halted the survey by March.Before transitioning to crypto writing in 2018, Mike studied library and information sciences. Currently, he resides on Canada’s West Coast.AJ, a passionate journalist since Yemen’s 2011 Arab Spring, has honed his skills worldwide for over a decade. Specializing in financial journalism, he now focuses on crypto reporting. Catch the latest in crypto by following us on X. Stay informed on the go.The S-1 filing follows the SEC’s approval of NYSE Arca’s proposed rule change on behalf of ProShares.Rob Marrocco believes crypto ETFs beyond Bitcoin and Ethereum are unlikely without first establishing a futures market or changing regulation.Ripple said Standard Custody CEO Jack McDonald would help the firm achieve its USD-backed stablecoin plans.The examinations will determine S&C’s awareness of FTX misconduct and potential conflicts during SBF’s Robinhood shares acquisition.CryptoSlate’s latest market report dives deep into the effects corporate Bitcoin purchases have on the market.Disclaimer: Our writers’ opinions are solely their own and do not reflect the opinion of CryptoSlate. None of the information you read on CryptoSlate should be taken as investment advice, nor does CryptoSlate endorse any project that may be mentioned or linked to in this article. Buying and trading cryptocurrencies should be considered a high-risk activity. Please do your own due diligence before taking any action related to content within this article. Finally, CryptoSlate takes no responsibility should you lose money trading cryptocurrencies.
