Marathon Digital (NASDAQ: MARA) - American company, which is engaged in bitcoin mining on an industrial scale. At the moment, the business occupies a leading position among competitors in terms of hashrate, that is, the total computing power, needed to create new blocks and receive rewards in the Bitcoin network.
What he earns
The company creates and develops infrastructure for bitcoin mining on an industrial scale: for November, 2021 Marathon Digital reported on ownership 31 000 working devices, which together generate computing power 3,2 exahash per second, which allowed the business to independently mine 2712 bitcoins per year. The organization has approximately 7,649 bitcoins worth $437 million on its balance sheet., as well as 623 million cash.
What's wrong
Expensive electricity. The company has the most unfavorable tariff for electricity consumption among its competitors: compared to the same Riot Blockchain, who pays 24 $ per MWh, Marathon Digital pays for the same volume 42 $ - almost twice as much. Given that, that the company has developed the largest total hashrate among competitors, Inflated electricity costs are putting increasing pressure on businesses.
Volatility and government regulation. The movement of the price of bitcoin alternately pleases investors with strong growth and cools their ardor with active corrections.: from recent all-time highs cryptocurrency lost order 30% cost. For her, this is quite normal., but at the same time it destroys the capital of short-sighted retail players in the market.
At the same time, the threat from state regulators remains., who, together with the banking system, are not too fond of the aggressive expansion of decentralized finance: only recently, the SEC in the United States did not allow two new cryptocurrencies to enter the market ETF от Valkyrie и Kryptoin.
long term question. Most of the costs of all mining companies are the purchase of ASIC miners - specific "computers", with maximum efficiency performing work on the extraction of cryptocurrency. Bitcoin supply is limited 21 a million coins, And, calculated, they will be mined around 2140.
The prospect is distant, but there is a big question: what will companies then do with hundreds and thousands of miners, who have nothing more to gain? Supposed, that the source of remuneration for the formation of new blocks will ultimately be commission fees, but the prospects for such a transition are not completely clear.
What good
Cryptocurrency. In the case of any company, which builds its business around bitcoin, crypto assets are the main risk factor, but at the same time, the main factor in the possible exponential growth of the share price. We can't see into the future, but those facts speak in favor of "digital gold", that bitcoin has already managed to grow hundreds of times and cover the whole world with intranet transactions.
The number of issued coins is strictly limited, which greatly reduces the risk of inflation, and the cryptocurrency itself is increasingly reaching the level of entire states, which confirms the recent example of El Salvador. Therefore, in the long term, the entire business tied to the extraction and accumulation of cryptocurrency, seem to be, a bright future awaits - he just needs not to go broke before his onset.
Hashrate Leader. Among the main competitors, Marathon Digital owns the largest hash rate - the total computing power, needed to mine bitcoin and receive rewards for creating a new block in the blockchain. At the moment, the company has developed capacity 3,2 exahash per second and plans to more than quadruple this figure by mid-2022 to 13.3 exahash per second.
And again, taking care of ESG. Like all other crypto miners, Marathon Digital Vulnerable to Public Attacks on Bitcoin Mining. In a recent presentation, the company highlighted a separate slide numbered 12, to present to investors their greening plan. By the end of the first quarter of 2022, carbon neutrality should be 70%, and by the end of the year, the mining process should reduce carbon emissions to zero.
What's the bottom line?
Marathon Digital stocks are another opportunity to invest almost directly in bitcoin through stock market. The company bears all the risks, related to crypto assets, therefore, investing money here is related to the attitude of potential investors to the field of decentralized finance. Someone will have an optimistic attitude and faith in the "economy of the future", and others will share Charlie Munger's skepticism and also find bitcoin disgusting. In any case, winners and losers will be determined by time..
