• Marathon Digital (MARA) has disclosed its mined 93 million KAS worth $15 million.
• The Bitcoin miner says the operation is part of its diversification of its revenue streams.
• Marathon to deploy full 60 petahash of KAS power in Q3, 2024.

Bitcoin (BTC) mining firm Marathon Digital has announced that it now mines Kaspa (KAS), a layer-1 proof-of-work (PoW) coin.

In a press release published today, Marathon Digital said the mining operations had seen the company mine 93 million KAS as of June 25. The value of the mined Kaspa tokens was around $15 million at the time.

Marathon diversifies with Kaspa (KAS) mining

According to Marathon Digital, the move to launch KAS mining is part of the company’s quest to diversify its revenue streams. Adam Swick, Marathon’s chief growth officer, said:

“By mining Kaspa, we are able to create a stream of revenue that is diversified from Bitcoin, and that is directly tied to our core competencies in digital asset compute,”

Swick commented further on the decision, noting:

“Because of our existing infrastructure, our unique relationships with hardware manufacturers, our strong balance sheet, and the expertise of our team, Marathon was uniquely positioned to mine Kaspa and to capitalize on the higher margins that exist for those who can deploy Kaspa ASICs today.

Kaspa is 5th-largest proof-of-work coin

Kaspa currently ranks as the world’s fifth-largest PoW coin by market cap with over $4.1 billion.

According to CoinMarketCap, top PoW coins above Kaspa by market cap are Litecoin, Bitcoin Cash, Dogecoin and Bitcoin.

As of writing, the cryptocurrency ranks 28th overall by market cap and was seeing over $56 million in daily trading volume. Kaspa has a maximum supply of 28.7 billion KAS, with circulating supply currently at 24 billion KAS. The network’s block reward is currently 103.83 KAS.

While Bitcoin produces one block every 10 minutes, Kaspa’s BlockDAG mechanism allows for one block per second, which means faster transactions.

Marathon’s Kaspa mining power

Marathon first looked into Kaspa mining in May 2023, and deployed its first ASICs for the altcoin in September. Scaling of this new mining operation followed and the company has acquired 60 petahash of Kaspa ASICs.

ASIC Miner Value estimates that these machines can generate profits of up to 95% margins based on the current KAS price and network difficulty.

Marathon currently has 50% of its Kaspa mining capacity (30 petahash) in operation at the company’s facilities in Texas. Meanwhile, it expects to have the remaining capacity fully operational in Q3 2024.

The price of KAS was 9% up in 24 hours, trading around $0.175 on Wednesday at 5:13 pm ET.

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• Bitfarms produced 411 bitcoins last month and sold 362.
• The Canadian miner is still lagging behind last year’s figures.
• Bitfarms stock is currently down 40% versus its recent high.

Bitfarms Ltd says its mining output popped 7.3% in September as it continued to install new miners and “fully energised” its facility in Rio Cuarto to 51 MW.

Bitcoin still holds 703 BTC in total

The Canadian miner produced a total of 411 bitcoins last month – of which it sold 362 for about $9.5 million. Geoff Morphy – the Chief Executive of Bitfarms said in a press release today:

We continue to believe that many of our best opportunities for growth and investment will arise around the next Bitcoin halving expected to occur in April 2024.

The Toronto-headquartered firm still holds nearly $20 million worth of Bitcoin (703 in total). Its total operating capacity now sits at 233 MW.

Shares of the bitcoin mining company are still down about 40% versus their recent high.

Bitfarms is still lagging last year’s figures

Bitfarms is committed to strengthening its balance sheet and infrastructure ahead of the halving event next year – by which, it expects to have paid off under $10 million it still has in debt.

The bitcoin mining company now has a total operating capacity of 233 MW. Its hash rate improved another 9.0% in September to 6.1 exahashes per second (EH/s).

Bitfarms wanted its hash rate to hit 6.3 EH/s in the third quarter but “electrical infrastructure delays” at its Baie-Comeau facility saw it come a bit shy of the target.

Note that the Canadian miner is still trailing the numbers it reported last year. Bitfarms mined 3,692 BTC in the first nine months of this year versus 3,733 Bitcoin in the equivalent period of 2022. Wall Street currently has a consensus “buy” rating on BITF.

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• USBTC to host 8,500 miners belonging to Celsius at its Alpha Site.
• Hashrate of these machines is estimated to be 820 petahash (PH).
• Us Bitcoin Corp expects to be managing over 310,000 miners in total.

US Bitcoin Corp is in focus today after the mining company announced a deal with the bankrupt cryptocurrency platform Celsius Network.

USBTC is a part of Fahrenheit consortium

The data centre operator said in a press release this morning that it will host 8,500 miners belonging to the now defunct crypto lender at its Alpha Site.

Note that USBTC is a member of the Fahrenheit consortium that took over Celsius assets in May. According to Asher Genoot – the President of US Bitcoin Corp:

Opportunity to manage Celsius assets marked a defining milestone … We envision a future where Bitcoin mining is not just profitable but sustainable and industry advancing.

At the time, the said assets which included more than 120,000 miners were valued at about $2.0 billion (find out more).

USBTC to manage more than 310,000 miners

Hashrate of the machines that US Bitcoin Corp plans on hosting at its Alpha Site is estimated to be 820 petahash (PH). Genoot also said in the press release today:

We’re embarking on a new chapter. The synergy between USBTC, Celsius, and Fahrenheit represents our commitment to redefining the mining industry.

USBTC now expects to be managing over 310,000 miners in total including its own machines as well as those of clients like Marathon Digital, Sphere 3D, Teslawatt, Foundry USA, and Decimal Group.

The news arrives only days after Hut 8 Mining issued an update on its in-process merger with Hut 8 Mining.

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• CleanSpark narrowed its loss in its fiscal third quarter.
• The bitcoin mining company had a blockbuster July.
• CleanSpark shares are up over 150% YTD at writing.

Bitcoin miner CleanSpark Inc is trading slightly up in extended hours after reporting a narrower-than-expected loss for its fiscal third quarter.

CleanSpark Q3 financial highlights

Lost $14.2 million versus the year-ago $29.3 million

Per-share loss also narrowed from 40 cents to 12 cents

Revenue jumped 47% year-on-year to $45.5 million

Consensus was 17 cents loss on $45.7 million revenue

Ended the quarter with $125 million of cash and bitcoin

The bitcoin mining company now has assets worth more than liabilities on its balance sheet. Gary Vecchiarelli – the Chief Financial Officer of CleanSpark said today in the press release:

I like the flexibility of our balance sheet and our operational performance. We have all pieces in place to extend our strong track record of growth and operational excellence.

CleanSpark had a blockbuster July

CleanSpark had its Georgia location go live in July that added more than 15,000 miners and 50 megawatts of power, as per the press release.

The Nasdaq-listed firm trailed only Marathon Digital and Core Scientific in terms of the number of bitcoin mined last month. According to its CEO Zach Bradford:

We have fully funded our growth to 16 EH/s, including miners, facilities, and other infrastructure. We continue to build on our track record of executing on commitments.

The hash rate improved to 9 EH/s in its recently concluded quarter. At writing, shares of CleanSpark Inc are up more than 150% versus the start of 2023. Its peer Marathon Digital also reports its quarterly update earlier this week (read more).

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• Marathon Digital reports weaker-than-expected results for its fiscal Q2.
• CEO Fred Thiel was still positive in the press release on Tuesday.
• Marathon Digital stock is currently up more than 350% year-to-date.

Shares of Marathon Digital Holdings Inc showed resilience in extended hours even though the Bitcoin miner reported disappointed financial results for the second quarter.

CEO Fred Thiel was still positive in the press release

The digital asset technology company lost 13 cents a share on an adjusted basis in its recently concluded quarter on $81.8 million in revenue.

In comparison, analysts had called for a loss of 6 cents per share only and $83.4 million in revenue. Still, CEO Fred Thiel said in the press release today:

After a strong start to the year, we accelerated our progress in the second quarter by significantly growing our hash rate and improving our efficiency.

Shares of Marathon Digital Holdings are up more than 350% year-to-date at writing.

Marathon Digital sold 63% of produced Bitcoin in Q2

Marathon Digital produced 2,926 Bitcoin in total in its second quarter and gained $23.4 million as it sold 63% of them to fund operating costs. According to the Chief Executive:

We exited the quarter with $113.7 million in unrestricted cash and equivalents and 12,538 Bitcoin, the market value of which was approx. $380 million on June 30^th.

The miner also saw impairment charges narrow sharply to $8.4 million in its Q2.

On Tuesday, Marathon Digital also confirmed in an 8-K filing that it had to restate cash flow for Q1. Wall Street currently has a consensus “overweight” rating on the world’s largest listed Bitcoin miner.

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• After the July 19 circular, it is illegal to engage in any cryptocurrency activities in Kuwait.
• Kuwait has joined Thailand, Indonesia, and Turkey to ban crypto activities.
• Violators are to face penalties as stipulated in Kuwait’s AML and terrorist financing laws.

Kuwait’s financial watchdog, the Central Markets Authority (CMA), issued a circular on July 19 declaring that all cryptocurrency activities including crypto investment, crypto payments, and crypto mining as described here were illegal in the Middle Eastern country.

The CMA also banned local regulators from granting licences to anyone attempting to “provide cryptocurrency services as a commercial business.”

Tough penalties for violators

The nation’s anti-money laundering and terrorist financing laws carry harsh punishments, the financial regulator warned. The circular made it clear that “securities regulated by the Central Bank of Kuwait and other securities and financial instruments regulated by the Capital Markets Authority” are exempt from the prohibitions.

In addition to forbidding cryptocurrency-related activities within the nation, the Kuwaiti regulator informed clients of the dangers posed by cryptocurrencies. “They do not carry a legal status and are not issued or supported,” it declared.

Kuwait has joined the list of nations like Thailand, Indonesia, and Turkey that forbid accepting cryptocurrency payments.

Kuwait’s move to ban cryptocurrencies comes after the National Committee for Combating Money Laundering and the Financing of Terrorism concluded its study that aimed at implementing Recommendation 15 of the International Requirements of the Financial Action Task Force (FATF). However, it is essential to note that the FATF does not mandate that nations outlaw cryptocurrency.

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• Dash block reduction occurred at block height 1,892,161.
• Unlike Bitcoin halving that cuts block rewards in half, Dash reduces its reward by 7.14% after every 210,240 blocks.
• Currently, the reward is 2.3097 DASH and will reduce again in July 2024.

The block reward on the Dash (DASH) blockchain network has reduced after its halving that took effect at block height 1,892,161.

Like Bitcoin, Dash cuts its block reward. However, instead of the halving that for instance sees Bitcoin’s block reward cut in half every four years, Dash reduces the reward by 7.14% every 210,240 blocks.

With the network’s block time of 2.5 minutes, DASH block reward reduction happens approximately every 365 days. The countdown to the next halving is estimated to occur in the first week of July 2024, with the block reward set to reduce from 2.3097 DASH to 2.1448 DASH.

Dash block reward distribution

Like in other mining coins, block reward reduction affects what miners earn for deploying their computational power to process transactions and secure the network. Reducing the reward therefore impacts their overall profitability.

For instance, Dash’s latest halving saw mining pool ViaBTC inform miners that the reward will reduce from 1.05 to 0.98 DASH.

Block rewards are split three-way: Miners and masternodes, which are key to the network’s privacy feature (CoinJoin) and instant transactions (InstantSend), share 90% of the block reward, while 10% goes to the DASH Treasury DAO.

Currently, the distribution between miners and masternodes is 42.3% and 57.7% respectively. The ratio is set to change in favour of the masternodes over time, with this reaching the 40:60 ratio by May 2025.

DASH “halving” happens approximately 40 days to Litecoin’s halving expected in August this year. After that, the most anticipated block halving event will be Bitcoin’s, which is scheduled to happen in April 2024 (the countdown is down to about 308 days).

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• Hut 8 Mining reports a 64% year-on-year hit to revenue in its Q1.
• Craig-Hallum analyst sees downside in “HUT” to C$2.0 a share.
• Hut 8 Mining stock is now down nearly 30% versus its YTD high.

Hut 8 Mining Corp is trading down on Thursday after reporting a massive year-on-year decline in its first-quarter revenue.

Notable figures in Hut 8 Mining Q1 report

• Earned C$0.47 a share versus C$0.15 a share loss expected
• Revenue tanked a more than expected 64% to C$19 million
• Mined 475 bitcoin – down roughly 50% versus a year ago
• Increased its installed hashrate in the quarter to 2.6 EH/s

At its Ontario facility, Hut 8 Mining had to switch off roughly 8,000 machines because of a dispute with Validus Power Corp. In the press release, CEO Jamie Leverton also said:

In early 2023, we experienced a confluence of events: electrical issues at our Drumheller site caused equipment failures, fluctuating energy prices and increased network difficulty.

Versus its year-to-date high, Hut 8 Mining stock is down nearly 30% at writing.

Is Hut 8 Mining stock worth buying?

So far, only 1,000 of those machines in its Ontario facility are back online and its Alberta mine is running at just 15% of its installed hashrate.

Hut 8 Mining is currently in the process of merging with USBTC or U.S. Bitcoin Corp. According to the Chief Executive:

We have made progress on key regulatory files required to complete the transaction. We also reached an all-time operational high of 1.72 EH/s at our Medicine Hat facility.

Despite underperformance, it may not be the best of ideas to take a position in this Canadian company today considering a Craig-Hallum analyst reiterated his “hold” rating on Hut 8 Mining stock this week. His C$2.0 price target suggests another 10% downside from here.

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• Core Scientific is seeking emergency relief from the bankruptcy court for it to secure a replacement loan facility.
• According to court documents, the miner has agreed to a $70 million credit facility from investment banking firm B. Riley.
• The company will use the funds to pay off an existing loan to avoid defaulting,

Core Scientific, a Bitcoin mining firm that filed for Chapter 11 bankruptcy orotection in December last year, says it’s agreed to a $70 million financing facility from B. Riley Commercial Capital, LLC.

Court documents the Bitcoin miner filed on Tuesday reveal that the crypto company seeks to use the loan facility from the investment bank to pay off an existing debtor-in-possession (DIP) facility.

Core Scientific seeks emergency relief

The miner seeks an emergency relief from the bankruptcy court, which it says is needed no later than 11:30 am CET on Wednesday, 1 February, 2023. As noted in the filing, the crypto miner would be in default under the terms of the original DIP facility.

The Core Scientific team says if approved, the first part of the facility will be $35 million before the rest follow. Securing the new credit facility from B. Riley is key to the miner continuing its operations as it navigates its bankruptcy process.

The past year proved to be particularly brutal for crypto mining companies, with the crash in Bitcoin prices and surging energy costs combining to hurt business. Core Scientific was one of the largest miners to seek bankruptcy protection as Bitcoin price collapsed once more following crypto exchange FTX’s implosion.

At the time of its bankruptcy filing, Core Scientific revealed liabilities of $1 billion to $10 billion.

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• Bitcoin miners Core Scientific rose 33% as stocks of Bitfarms, Stronghold Digital, CleanSpark all ended the past week higher.
• Coinbase and Robinhood shares also rose as Bitcoin broke above $23,000.
• FOMC meeting is this week and the market reaction will be key to what next for Bitcoin and crypto stocks.

A number of crypto-related stocks are looking to extend gains notched in the past few days after closing in positive territory on Friday.

Among those to rip are share prices of crypto mining firms that had been struggling badly after reaching new all-time lows amid the crypto winter. 

This is happening even as Bitcoin price looks to push higher after holding above the $23,000 level over the weekend. A crucial macro news event to watch out for is the FOMC meeting this week.

Surge in Bitcoin price helped crypto stocks

Core Scientific (CORZ), the world’s largest publicly-traded Bitcoin miner, surged an impressive 33% on Friday, while crypto mining firm Digihost Technology (DGHI) saw its shares jump more than 11%.

Stocks of NASDAQ-listed miners Bitfarms (BITF), Stronghold Digital Mining (SDIG), Bit Digital (BTBT) and CleanSpark (CLSK) all ended the week in the green. Elsewhere, NYSE-listed Bit Mining and SOS ADR also rose.

Coinbase (COIN) and Robinhood (HOOD) stocks also traded higher, with the US-based crypto exchange’s stock soaring more than 15% on Friday. Coinbase‘s stock is up more than 73% in the past 30 days before markets open on Monday, 30 January. Robinhood shares ended the week 8% higher and were up nearly 28% over the past 30 days.

Bitcoin price, FOMC – what next for crypto stocks?

As noted, most of these publicly listed crypto companies saw their share prices soar alongside the positive price action of Bitcoin. But crypto has also largely correlated with stocks, with this week crucial in terms of the Federal Open Markets Committee (FOMC) meeting. 

On the positive side of things…

BTC/USD reached highs of $23,955 last week and is up more than 40% year-to-date. According to recent data from crypto analytics platform Glassnode, BTC’s recent upside momentum has the flagship digital asset’s price above three key on-chain metrics.

The breakout above $22,800 had Bitcoin above both the long term and short term cost-basis as well as Realized Price – the first time this has happened since 2020 COVID-19 induced crash. Also, the previous time when prevailing BTC price was above the three metrics was during the 2018/19 bear market.

On the flipside…

As covered by CoinJournal, Glassnode suggested last week that bulls managing to hold above the $22.4k level would aid sentiment and potential further gains. However, this week could see recent momentum derailed if investor reaction to the Federal Reserve’s FOMC minutes turns out to be negative. 

Investors are bracing for another rate hike this week, with markets expecting a 25 basis point increase. @steveliesman reports on whether a #PowellPivot is close: pic.twitter.com/BGF5sRScXE

— Squawk Box (@SquawkCNBC) January 30, 2023

Although the market already expects a 25 basis point rate hike, some experts believe it would be a disaster for the markets if the Fed goes for a 50 basis point hike instead.

According to CoinGecko, Bitcoin was trading 1.1% down at 7:15 am ET on Monday as FOMC-related volatility likely began to set in across markets.

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