Slide 1: Presentation for Analyst Day
Presentation for Analyst Day MARCH 7, 2023
Slide 2: Cipher Mining Presenters
Cipher Mining Presenters Samy Biyadi Patrick Kelly Chris Totin Bryan Keller Reuben Govender Head of Power Co-President / Chief Construction Officer Chief Technology Officer Head of Markets Chief Operating Officer 2
Slide 3: Power Procurement & Portfolio Introduction
Power Procurement & Portfolio Introduction
Slide 4: A Solar Asset in the Desert
A Solar Asset in the Desert Case Study – Not a Cipher Project Located in the “Project Salvador will Atacama demonstrate that solar is a Desert in Chile viable and sustainable power solution in Chile given the strong solar irradiation and 70 MW high electricity prices in the Peak Solar Capacity regio
Slide 5: Could a bitcoin mining facility have been the solution?
What Went Wrong 1 2 3 Structural imbalances Transmission infrastructure Strong correlation of the between the local power deployment delays leading to power production profiles production & consumption in high curtailment levels leading to low nodal prices the northern part of Chile Could a bitcoin
Slide 6: A Collaborative Approach to Turn Under-Monetized Electrons into Digital Assets
A Collaborative Approach to Turn Under- Monetized Electrons into Digital Assets BITCOIN MINING LOAD: A UNIQUE ENERGY ASSET THE PROBLEM Local monetization of Vast amounts of energy are under-monetized due to various factors, including: electricity produced Transmission and distribution infrastructure
Slide 7: Snapshot of Assets Portfolio
SNAPSHOT OF ASSETS PORTFOLIO Long-Term Power Offtake to Protect Mining Profitability Diversified Mix of Sites as a Risk Mitigation Approach Self-Mining Capacity 236 MW Sites Across Texas 2 FTM(1) + 2 BTM(1) = 4 Total Capacity Collocated with Total Capacity Fully Hedged 96% 96% a Power Asset Remainin
Slide 8: What's Next? Expansion at Existing Sites, New Sites & PPAs
WHAT’S NEXT? EXPANSION AT EXISTING SITES Opportunistic expansions at existing sites with available capacity: • Alborz − Secure a grid connection to import power from the market as a complement to wind energy − Increase the data center capacity to match the wind farm interconnection capacity Alborz D
Slide 9: Operations
Operations
Slide 10: Operations Team Structure
Operations Team Structure Construction Site Operations Corporate Operations Technology • Engineering • Infrastructure • Awards & trade • IT network • Permitting operations & settlement implementation maintenance • Logistics & customs • IT security & systems • Procurement • Miner deployment, • Portfo
Slide 11: Team Leads
TEAM LEADS CO-PRESIDENT / COO Patrick Kelly – Co-President / Chief Operating Officer Chris Totin – Chief Construction Officer CONSTRUCTION Lee Rivers – Director of Data Center Field Operations SITE OPERATIONS Courtney Frazier – Head of Corporate Operations CORPORATE OPERATIONS Bryan Keller – Chief T
Slide 12: Operational Leverage
Operational Leverage 26 Cipher Full Time Employees OUTSOURCING PRINCIPLES 25 • Identify and secure industry best vendors, contractors, and suppliers • Significant experience and internally sourced references • Relevant licenses and certifications (SOC1/2) Dedicated Contractors • Ability to quickly s
Slide 13: Key Indicators as of February 28, 2023
Key Indicators as of February 28, 2023 OPERATIONAL POWER (MW) HASH RATE (EH/S) MACHINES 236 5.2 48k+ 11,000+ Current Current Operating To Be Energized 15.59 BTC 465 BTC 398 BTC Daily Production High BTC Held Monthly Production February Note: Values represented are approximations 13
Slide 14: Odessa Site Overview
Odessa Site Overview CIPHER MINING’S FLAGSHIP DATA CENTER
Slide 15: About Me – Chris Totin
About Me 568MW $21.2B Data Center Value of Projects Capacity Delivered Developed Chris Totin Chief Construction Officer Hats Worn Dad General Contractor 3 Kids <6 Years Old Subcontractor 6 Yr Old Girl - Valyn Project Manager 3 Yr Old Girl – Vera Construction Manager 9 Mth Old Boy – Rohm Program Mana
Slide 16: A View from Low Earth Orbit
A View from Low Earth Orbit
Slide 17: Odessa Data Center Quick Facts
Odessa Data Center Quick Facts 51.5 Acres 60,000+ ASICs(1) ~40 football fields 207 MW of capacity Remotely Operable Hyperscale Inspired Fully automated operations from switching to Designed to traditional data center specifications ticketing (1) Represents ASICs capacity of the Odessa data center at
Slide 18: Development Timeline
Development Q4 2021 Timeline Design 18
Slide 19: Design
Design KEY FEATURES 1 Simple 4 Elevated 2 Redundant 5 Optimized for Uptime 3 Robust 6 Decentralized 19
Slide 20: Development Timeline
Development Q4 2021 Timeline Design DEC 2021 Completed Procurement of Long Lead Equipment 20
Slide 21: Globally Sourced
Globally Sourced Equipment / Material Location MV Switchgear Germany VESSEL TRACKING PLATFORM LV Switchgear Canada HV Cable Turkey Miner Thailand Miner Malaysia Modular Data Center Texas, USA O&M Building Georgia, USA MV Transformers China Network Switches Korea Engineering Services Louisiana, USA M
Slide 22: Development Timeline
Development Q4 2021 Timeline Design DEC 2021 Completed Procurement JAN 2022 of Long Lead Equipment Broke Ground 22
Slide 23: Beginning Conditions at the Odessa Data Center
Beginning Conditions at the Odessa Data Center
Slide 24: Development Timeline
Development Q4 2021 Timeline Design DEC 2021 Completed Procurement JAN 2022 of Long Lead Equipment Broke Ground Started Construction SEP 2022 Ready to Mine First Circuits Completed & Ready to Start Mining NOV 2022 ERCOT Approval Started Mining 24
Slide 25: Odessa Current Footprint
ODESSA Current Footprint Odessa ~4.2 EH/s 143 MW Hashing 53 Miles Electrical Capacity Cables Installed 85 41 Miles Transformers Fiber Optic Installed & Cables Energized Installed
Slide 26: Site Operations
Site Operations Data Center Technicians Remote Operations Ticketing Data Science Data Center Operations Success Equation Ticketing platform Close partnership + + + = Highly experienced Infrastructure to that automates, with data science and qualified Data enable remote prioritizes, and team to build
Slide 27: Technology
Technology
Slide 28: Making Cipher a Data Driven Company
CIPHER TECH Making Cipher a Data Driven Company Data Engineering Data Science Info Security App Development Infra Support Creating the best Developing insights Monitoring threats Building custom Making sure data sourcing and through models and implementing software for miner everything works reporti
Slide 29: Using Data to Drive Site Ops and Site Ops to Enhance Data
Using Data to Drive Site Ops and Site Ops to Enhance Data Data Sourcing Business Logic Miner Control Miner Firmware Transmission & Production decisions control LMPs KPI, Monitoring, and Alerting miner statistics Data Science & Business Analysis 29
Slide 30: Alborz
Alborz Pioneering Data Driven Operations in Bitcoin Mining KEY CHALLENGES • Fully behind-the-meter • No grid connection, need to react to 100% of production volatility in real-time while maximizing available power availability • Wind is challenging; storms come suddenly • Significant consequences to
Slide 31: Bear and Chief
Bear and Chief Optimizing Dollar Profitability for Grid Connected Sites KEY CHALLENGES • Only operate when profitable • Enhance revenue through participation in day-ahead markets • Monetize ancillary services through rapid curtailment • Need to avoid 4CP events • Sites are remote 31
Slide 32: Odessa
Odessa Deploying Data Driven Analysis for Operations at Scale KEY CHALLENGES • Reacting to Luminant curtailment actions • Enhance revenue through power sales • Optionality on take-or-pay - combined challenge of FTM/BTM site • Very large scale 32
Slide 33: Some Other Cipher Use Cases for Model Driven Decisions
Some Other Cipher Use Cases for Model Driven Decisions EXAMPLES OF OTHER DATA SCIENCE INITIATIVES Neural Net modeling of projected network hash rate Bitcoin price predictions Power market volatility and spike probability Quantifying ‘cost to curtail’ Strategic decision modeling Data anomaly and outl
Slide 34: Treasury Platform
Treasury Platform
Slide 35: Treasury Platform Overview
Treasury Platform Overview Leverage 15+ years of Minimize power price Prudent Ensure a safe and commodities exposure through management of BTC robust control and experience providing optimization inventories and cash operational solutions to corporate strategies balances environment under a producer
Slide 36: BTC Management – Overview
BTC Management – Overview CORE STRATEGIES SELL HOLD • Daily liquidation • Target inventory build over time • Target OPEX+ coverage • Serviceable as collateral • Balance liquidity and market view • Increase allocation with strong bullish view • Increase allocation with strong bearish view OPPORTUNIST
Slide 37: BTC Management – Principles
BTC Management – Principles LIQUIDATION PRINCIPLES HEDGING PRINCIPLES • Minimize market impact with TWAP execution • Outperform hurdle rate on liquidation strategy • Cold wallet storage for inventory • Select high quality counterparties • Continuous monitoring of trading hot wallet • CME futures / F
Slide 38: Power Management
POWER MANAGEMENT BEHIND-THE-METER Odessa • Fixed price PPA with embedded optionality • Fully automated mine / curtailment management of data center • Optimize power price exposure through real-time sale of power when revenue is greater than mining economics • Take advantage of forward sales of power
Slide 39: Safe Harbor
Safe Harbor • This presentation has been prepared by Cipher Mining Inc. and is made for informational purposes only. The information set forth herein does not purport to be complete or to contain all of the information you may desire. You must evaluate, and bear all risks associated with, the use of