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January 17, 2022
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U.S. Mining Company Marathon Now Holds 8,133 BTC. And They’re Not Selling It

In their December report, Marathon Digital Holdings introduced their complete BTC holdings. And assured their traders that they weren’t promoting any of it any time quickly. This is especially attention-grabbing contemplating the corporate purchased “a record number” of S19s in December. Reportedly, they obtained a large mortgage utilizing Bitcoin as collateral. An operation we’ll see much more within the close to future all through the business. 

The report quotes Fred Thiel, Marathon’s CEO, in a celebratory mode. “2021 was a transformative year for Marathon as we increased our hash rate 1,790% and increased our bitcoin production 846% year-over-year to 3,197 self-mined BTC.” Staggering numbers that present the dimensions of the Bitcoin mining enterprise.

As for his or her holding plans, the report says:

“The Company last sold bitcoin on October 21, 2020, and since then, has been accumulating or “hodling” all bitcoin generated. As a consequence, Marathon at the moment holds roughly 8,133 BTC, together with the 4,813 BTC the Company bought in January 2021 for a mean price of $31,168 per BTC.”

Of course, they’re not alone. NewsBTC documented the pattern all through the entire 12 months. 

Most Miners Are Holding Strong

One of the primary individuals to identify the pattern was Lex Moskovski. In February, the analyst reported on “the first day since Dec, 27 when Miners Position change turned positive.” 

Approximately 4 months in the past, NewsBTC used knowledge to discover a doable rationalization:

“Data reveals that miner profitability has dropped compared to the final time that bitcoin was at this price. The profitability for bitcoin again in April at $50K had been 40% increased than it’s proper now when bitcoin hit $50K once more. This implies that miner profitability is hitting the lows at all-time highs.

This drop in profitability has seen miners refusing to promote the BTC they’re rewarded with for mining blocks. Instead selecting to carry these coins in watch for a lot increased costs.”

Miner profitability could be reducing, however, the enterprise continues to be a good distance from turning crimson. Especially for a large operation like Marathon. In a latest interview that NewsBTC reported on, Fred Thiel mentioned:

“Thiel expressed that, factoring operational mining costs (energy plus hosting), Bitcoin’s breakeven rate is roughly $6,500, meaning that the digital coin would need to drop at least 80% for Marathon to face challenging difficulties.”

Less than three months in the past, NewsBTC reported on one other set of information that confirmed the identical phenomenon:

“BTC miner reserves continue to trend sideways amid the coin’s strong move up. The “miner reserve” is a indicator that reveals the entire quantity of Bitcoin that miners are at the moment holding of their wallets. An enhance within the metric’s worth suggests miners suppose the coin’s worth will go up within the close to future, therefore they’re stocking up on it.”

BTCUSD price chart for 01/05/2021 - TradingView

BTC price chart for 01/05/2021 on FX | Source: BTC/USD on TradingView.com

The Marathon Mining Company’s Future

The firm’s latest billion-dollar funding is a play for the long run. Especially contemplating simply when these machines will arrive.

“On December 23, 2021, Marathon announced that it had entered into a contract with BITMAIN to purchase a record number of ANTMINER S19 XP (140 TH/s) bitcoin miners, all of which are currently expected to ship from BITMAIN between July 2022 and December 2022.”

The chip scarcity is actual, folks. If an order this dimension can solely be fulfilled in six to 12 months, one thing’s up. Also, by the seems of it, the ASIC manufacturing enterprise could be much more worthwhile than Bitcoin mining. That’s a subject for an additional day, nevertheless.

Featured Image by Mārtiņš Zemlickis on Unsplash - Charts by TradingView

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