Bitcoin Mining Companies HOLD Their Coins
Crypto mining companies in the US led the surge in the stock market earlier this week when it became known that most of them were HODLing their coins rather than selling them to the market.
As Bitcoin reached record highs they were getting ever richer. Just like whale investors, crypto mining companies have become HODLers (Yahoo revealed last month the Bitcoin mining firms in the US HOLD more than a billion worth of Bitcoin) who are awaiting an even higher price point.
In turn, many Wall Street investors are eagerly buying shares of these companies.
Chinese loss is American win
At the moment that China decided earlier this year to ban Bitcoin miners, there was disarray and widespread panic in the market. One summer later and US Bitcoin mining companies have resurfaced as the great winners of this shift.
One of the largest bitcoin miners, Marathon Digital (a WallStreetBets favorite), said in September already that its mining cost is about $5,612 per bitcoin, with margin of about 85%, when all of their mining rigs get deployed. At today’s Bitcoin prices of over $65,000 per Bitcoin, that represents an incredible profit margin of which even Apple and Tesla’ couldn’t dream of.
Other miners such as Bit Digital, Bitfarms, Hive Blockchain, Hut 8, Cleanspark, Sphere 3D and Greenidge Generation have also attracted interest from investors.
BTIG analyst Gregory Lewis explained:
With current BTC mining margins north of 90%, capital is aggressively flowing into the sector, which we expect to make BTC mining more institutionalized.