From heavy acquisitions to business transformation: How do mining companies cope with new challenges after BTC halving?

Original title: "Listed Bitcoin mining companies become high-quality investment targets? The top 10 have mined more than 20,000 BTC this year, and transformation and integration after halving will bring new changes"

Original author: Nancy, PANews

Heavy money to acquire chip developers to develop new products, spend huge sums of money to purchase mining machines/mining farms to expand computing power, rent data centers to increase revenue sources, deploy AI to try business diversification and transformation, sell a large number of company shares or Bitcoin to raise funds, and increase holdings of shares to "swallow" competitors... After the halving event, the news that followed is showing the various aspects of mining companies under the test of survival.

In fact, since entering 2024, the movements of listed mining companies have become the focus of capital attention. In particular, not long ago, former US President Donald Trump had a high-profile support for Bitcoin mining activities, which led to the market's bullish sentiment on mining companies. According to CompaniesMarketCap data, as of June 18, the total market value of 21 US-listed mining companies has risen to US$28.8 billion.

As mining companies face increasingly brutal reshuffles and integrations, future market share will be concentrated in mining companies with stronger capital, and many institutions have also given advice on investing in mining companies. For example, Bernstein recommends that investors buy stocks of crypto mining companies with outstanding performance; 10x Research also recently stated that crypto mining stocks may rise further and recommends investing in the potential bullish trend of Bitcoin.

In this article, PANews counts the top 10 US-listed mining companies by market value. Judging from market trends, these mining companies have mined more than 21,000 bitcoins this year, and as the profit margins have been greatly compressed after the halving of Bitcoin, these companies have given countermeasures, and the competition for computing power expansion, business transformation and mergers among mining companies has already begun; from the perspective of stock price performance, the average highest increase of the top ten listed mining companies this year is about 88.3%, and the total market value exceeds US$24.6 billion, accounting for more than 91.6% of the total market size (the following data are as of June 17).

Marathon Digital Holdings (MARA) Market value: US$5.5 billion

Marathon Digital Holdings is the largest listed Bitcoin mining company. According to Bitcointreasuries.net data, Marathon holds more than 17,000 bitcoins. Marathon mined 12,850 bitcoins in 2023, generating more than US$380 million in revenue, and has mined 4,277 bitcoins so far this year.

In the past few months, Marathon has been continuously optimizing its mining products and expanding its computing power. It plans to reach 50 EH/s by the end of 2024, doubling its computing power from the beginning of the year. For example, Marathon Digital acquired Applied Digital's Bitcoin mining data center for $87.3 million, NiceHash and Marathon Digital cooperated to launch customized firmware for Bitcoin ASIC mining machines optimized for the NiceHash mining platform, and Marathon Digital launched mining products MARAFW firmware and MARA UCB 2100 control board, aiming to improve the efficiency and performance of Bitcoin mining machines. In addition, Marathon has also diversified its business, including launching the Bitcoin sidechain and related development platform Anduro, and signing an agreement with Kenya to invest more than $80 million to develop the energy infrastructure of the African country.

CompaniesMarketCap data shows that Marathon's market value is $5.5 billion, ranking 2473rd in the world, more than 14.1 times higher than in 2022. Google Finance shows that MARA has risen by as much as 35.3% since the beginning of this year.

CleanSpark (CLSK) Market value: $4.03 billion

CleanSpark's market size is second only to Marathon. In the first quarter of this year, CleanSpark's net profit exceeded $126.7 million, a year-on-year increase of 163%. According to Bitcointreasuries.net data, CleanSpark holds 6,154 bitcoins. Among them, CleanSpark has mined 3,746 bitcoins since 2024.

In the past few months, Cleanspark has also been increasing production and expanding computing power, including plans to purchase 160,000 Bitmain S21 mining machines, of which the first order of 60,000 mining machines is worth $193.2 million, and spending more than $23 million to acquire four Bitcoin mining facilities. In addition, CleanSpark also plans to launch an internal Bitcoin trading platform this year to maximize the returns on its cryptocurrency holdings.

CompaniesMarketCap data shows that CleanSpark's market value is approximately $4.03 billion, 1.98 times that of 2023. Google Finance shows that since the beginning of this year, CLSK has risen by nearly 103.1%, and some short sellers have lost more than $100 million because of it.

Riot Blockchain (RIOT) Market Cap: $3.04 billion

Riot Blockchain is one of the most funded mining companies in the first quarter of 2024, and its net profit for the quarter exceeded $210 million, setting a new quarterly performance record. According to Bitcointreasuries.net data, Riot currently holds 9,084 bitcoins. Riot produced 6,626 bitcoins throughout last year, setting a new record of total revenue of $281 million. So far this year, Riot has mined 1,954 bitcoins.

Riot is expanding its market share. On the one hand, Riot raised $559 million through equity issuance for its large-scale purchase of WhatsMiner mining machines from MicroBT, a bitcoin mining machine manufacturer, and spent $97.4 million to purchase 31,500 Shenma mining machines; on the other hand, Riot planned to acquire its competitor Bitfarms at a share price value of $950 million, but was rejected by the latter and tried to refuse the acquisition through a "poison pill" strategy. Riot then began to significantly increase its holdings in the latter's shares, and its current shareholding ratio has increased to 14%. Riot is also considered by Bernstein to be the most suitable mining company to integrate the bitcoin mining industry, with more than $1.3 billion in cash and bitcoin on its balance sheet.

CompaniesMarketCap data shows that Riot's current market value is $3.04 billion, which has not changed significantly from last year. Google Finance shows that since the beginning of this year, RIOT has risen by nearly 14.5%.

Phoenix Group (PHX.AE) Market value: $2.96 billion

Phoenix Group completed a $371 million IPO on the Abu Dhabi Stock Exchange at the end of last year. The IPO attracted $12 billion in funds and was oversubscribed 33 times. It is reported that International Holding Co., the largest conglomerate in Abu Dhabi controlled by important members of the UAE royal family, purchased a 10% stake in it.

According to the first quarter financial report disclosed by Phoenix Group this year, its total assets soared 237% year-on-year, from $261 million to $879.3 million; net profit reached $66.2 million, a year-on-year increase of 166%. Phoenix Group is also continuing to expand the scale of mining machines, announcing at the beginning of the year that it would purchase $187 million worth of Bitcoin mining machines from Bitmain.

According to CompaniesMarketCap data, Phoenix Group's current market value is $2.96 billion. And Google Finance shows that PHX.AE has risen by nearly 4.6% since the beginning of this year.

Iris Energy (IREN) Market value: $1.93 billion

Iris Energy is called an early entrant into high-performance computing by JPMorgan Chase and has the right to develop more than 2 GW of electricity. Currently, Iris Energy holds more than $320 million on its balance sheet, and its financial report discloses that the company has mined 1,592 bitcoins this year. According to Iris Energy's latest third quarter of fiscal year 2024, its bitcoin mining revenue reached $53.4 million, and its profit for the quarter reached $8.6 million. Iris Energy plans to increase its computing power to 30 EH/s this year by revising and signing a new agreement with Bitmain and building an additional 50MW of data center capacity in the Childress area in 2024.

CompaniesMarketCap data shows that Iris Energy's market value is US$1.93 billion, about 4.1 times higher than last year. Google Finance shows that IREN has risen as much as 232.1% since the beginning of this year.

Core Scientific (CORZ) Market value: US$1.83 billion

Core Scientific is one of the largest Bitcoin mining companies in the United States and once filed for Chapter 11 bankruptcy protection. In January this year, Core Scientific's restructuring plan was approved by the U.S. Bankruptcy Court and re-listed on Nasdaq. The agency will also begin to deploy in the AZI field, including signing a multi-year contract with AI supercomputing company CoreWeave to provide up to 16MW of data center infrastructure to support AI and HPC workloads, with potential revenue exceeding $100 million. Subsequently, Core Scientific announced a 12-year contract with CoreWeave, which is expected to generate an average annual revenue of approximately $290 million for Core Scientific, and the cumulative total revenue over the 12-year period will exceed $3.5 billion. In addition, Core Scientific also rejected CoreWeave's proposal to acquire the mining company for $5.75 per share, for a total price of approximately $1 billion.

According to the financial results data released by Core Scientific for the first quarter of fiscal year 2024, it generated net income of $210.7 million. So far this year, Core Scientific has produced 4,076 bitcoins. Last year, despite facing bankruptcy issues, Core Scientific still mined 19,274 bitcoins.

CompaniesMarketCap data shows that Core Scientific's market value has now reached $1.83 billion, a 70.3-fold increase from 2023. Google Finance shows that CORZ has more than tripled since the beginning of this year.

Cipher Mining (CIFR) Market value: $1.53 billion

Cipher Mining, which used to operate as a subsidiary of Bitfury, announced a share distribution plan in January this year, planning to reduce its shareholding from 75% to less than 20%. Before the Bitcoin halving, Cipher Mining purchased 16,700 new mining machines and planned to deliver them in the second quarter, bringing the company's total self-mining capacity to 8.4 EH/s.

Cipher Mining's net income in Q1 2024 reached $40 million. So far this year, Cipher Mining has produced 1,483 bitcoins. According to Cipher Mining's latest plan, it will make major upgrades to its mining equipment to increase the hash rate to 13.5 EH/s by the end of 2024, and the mining machine efficiency will reach 18.6 J/TH.

CompaniesMarketCap data shows that Cipher Mining's market value is $1.53 billion, up 44.3% from last year. Google Finance shows that CIFR has risen by as much as 29.1% since the beginning of this year.

Bitdeer Technologies Group (BTDR) Market Cap: $1.38 Billion

Bitdeer announced unaudited financial results and operating updates for the first quarter of 2024, showing total revenue of $119.5 million, a year-on-year increase of 64.6%, and a net profit of $600,000, compared with a net loss of $9.5 million in the first quarter of 2023. The revenue growth was mainly due to the increase in the company's self-mining business revenue due to the increase in self-mining computing power and the increase in Bitcoin production. In addition, as of March 31, 2024, the company had $118.5 million in cash and cash equivalents. So far this year, Bitdeer has produced 1,360 bitcoins.

Bitdeer has stepped up its research and development efforts on mining machines this year. For example, in March this year, itdeer announced that the successfully designed Bitcoin mining chip SEAL01 has an energy efficiency ratio of 18.1 J/TH, which will reduce operating costs and reduce the environmental footprint of miners; this month, Bitdeer announced plans to acquire ASIC chip design company Desiweminer in an all-stock transaction for US$140 million, thereby enhancing its hardware development capabilities; Bitdeer announced the technical roadmap of SEALMINER Bitcoin mining machines, committed to improving mining transparency, of which the first batch of SEAL01 chips are scheduled to be mass-produced and delivered in Q3 2024, and the second-generation SEALMINER mining machines are expected to start mass production and delivery in Q4, and the third-generation SEAL03 and fourth-generation SEALMINER mining machines are expected to start delivery in 2025; Bitmain has recently launched two new mining machines, namely Antminer S21XP and S21XP Hydro.

At the end of May, Bitdeer also announced the completion of a $150 million private placement financing, which will be used to finance the expansion of its data center, the development of ASIC-based mining machines, as well as working capital and other general corporate purposes. Among them, according to Tether Holdings Limited, it already holds a 25% stake in Bitdeer, making it the second largest shareholder of the Bitcoin mining company.

CompaniesMarketCap data shows that Bitdeer's market value is $1.38 billion, up more than 26.6% from last year. Google Finance shows that since the beginning of this year, BTDR has risen by as much as 12%.

TeraWulf (WULF) Market value: $1.3 billion

According to TeraWulf's latest announcement, as of May 31, 2024, TeraWulf's operating infrastructure capacity includes 160 MW at the Lake Mariner facility and 50 MW at the Nautilus facility, and the company's total self-mining hash rate is approximately 8.0 EH/s, an increase of 82% year-on-year. TeraWulf is also building a data center with a 30 MW capacity, and it is expected that the total mining capacity will increase to more than 10.0 EH/s in the second half of this year. In addition, TeraWulf is also advancing a 2.0 MW AI pilot at Lake Mariner, designed to adapt to the next generation of GPU technology.

TeraWulf has produced 1,590 bitcoins so far this year. According to CompaniesMarketCap data, TeraWulf's market value is $1.3 billion, nearly 2.4 times higher than last year. Google Finance shows that since the beginning of this year, WULF's highest increase has reached 123.3%.

Bitfarms (BITF) Market value: $1.18 billion

Bitfarms is the target of Riot's planned acquisition, and is currently taking a "poison pill" strategy to prevent the company from being acquired unsolicited and trying to reduce its attractiveness.

According to Bitfarms' first quarter financial results as of March 31, 2024, its computing power reached 7.0 EH/s in the first quarter, producing an average of 10.4 bitcoins per day, and total financial revenue reached $50 million, an increase of 9% from $46 million in the fourth quarter of 2023. So far this year, Bitfarms has mined 1,368 bitcoins. Currently, Bitfarms is also expanding its computing power and upgrading its mining equipment, including investing nearly $240 million to upgrade its Bitcoin mining equipment to triple its computing power to 21 EH/s to maintain profitability after the Bitcoin halving in 2024.

CompaniesMarketCap data shows that Bitfarms' market value is $1.18 billion, up 26.8% from last year. Google Finance shows that since the beginning of this year, WULF has risen by as much as 28.9%.

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