Bitcoin mining companies benchmarked each other at Bitcoin 2024 in Nashville last weekend, as the post-halving situation continues to put pressure on companies’ established business models.
While some public companies are seeing industry-wide hurdles as an opportunity to expand or even launch hostile takeover attempts, others are seeking to gain an advantage by diversifying revenue streams through innovations in areas like AI computing and chip manufacturing.
The annual conference was packed with companies making money from massive, power-hungry machines constantly running complex calculations in the race to validate bitcoin transactions. In April, the reward for that effort was cut in half in the halving, a once-every-four-years event that slows the pace of bitcoin’s gradually expanding supply.
Image: Andre Beganski/Decrypt
“Bitcoin miners will be going through an identity crisis in the first few months after the halving,” said Ryan Rasmussen, head of research at Bitwise Asset Management. Decryption“There is a headwind in the form of the block reward being cut in half.”
Rasmussen explained that he expects to see more consolidation within the bitcoin mining industry over the next 18 months, with some well-funded miners looking to absorb competitors. For example, Colorado-based Riot Platforms is Announced The company announced on Tuesday that it had acquired BlockMining after pursuing a hostile takeover bid for another company, Bitfarms, last month.
Brokerage firm Benchmark has identified tech-focused bitcoin miner BitDeer as a potential acquisition target. Research Report Benchmark this week noted that BitDeer is particularly attractive among its competitors, with “ample existing and planned power capacity.”
Image: Andre Beganski/Decrypt
Harris Bassit, chief strategy officer at BitDeer, said: Decryption The likelihood of a hostile takeover is extremely low He cited a capital structure that makes it difficult for competitors to take control, but acknowledged that acquisitions are a way management teams try to add value to existing companies, and that it ultimately boils down to a few metrics.
“These often happen when management isn’t adding value in other ways,” Bassit said of the acquisition. “If you think about a bitcoin mining company, there’s only so much management can do. They can only operate more efficiently and get cheaper capital, but that’s it.”
BitDeer’s global power capacity is the current 2.5 gigawatts is enough to power 250 million LED light bulbs. U.S. Office of Energy Efficiency and Renewable EnergyMeanwhile, BitDeer is currently using 36% of its power, and some of that capacity could be directed to generating revenue for artificial intelligence (AI) and high-performance computing (HPC) companies, Basit said.
Image: Andre Beganski/Decrypt
“We’re still in the evaluation phase,” he said. “We’ve hired a specialist consultant who has built a lot of data centers. […] They are looking at all our sites and evaluating them for use as AI or HPC data centers.”
BitDeer’s AI plans are similar to those of CoreScientific, and the company 12-Year HPC Hosting Contract The company partnered with cloud infrastructure company CoreWeave in late June. Meanwhile, Core Scientific’s shares have more than tripled, from about $3 in May to more than $10 as of Friday’s closing price.
BitDeer is also expanding into the ASIC industry, which makes chips specialized for bitcoin mining, not only as a way to further diversify BitDeer’s revenue, but also as it notes that this part of the bitcoin mining industry is dominated by Bitmain. Antminer.
Image: Andre Beganski/Decrypt
While some bitcoin miners are interested in acquiring competitors, Marathon Digital is interested in buying up the assets it mines. Said The company announced on Thursday that it will no longer sell Bitcoin and also announced that it has purchased $100 million worth of BTC on its balance sheet.
“We are thrilled to partner with Marathon to bring this exciting technology to the city,” said Jason Browder, Marathon’s senior vice president of government relations. Decryption In an interview, he said the company is now looking inward and focusing on its own business, rather than evaluating competitors. The company has 20,000 bitcoins, valued at more than $1.3 billion.
“We have the second-largest holdings of the coin among publicly traded companies in the world,” he said. “We believe this is a testament to our commitment to the asset and our belief in its long-term growth.”
Editor: Andrew Hayward
