Marathon Digital's decision to sell debt to buy Bitcoin highlights the severe challenges in the mining sector, indicating a pivot from traditional mining investments to strategic cryptocurrency accumulation.
Given the current mining hash price, Marathon Digital believes that purchasing Bitcoin using funds from debt or equity issuances is currently more beneficial for shareholders than expanding mining infrastructure.
This year, while MicroStrategy's stock has surged 90%, Marathon Digital's stock has plummeted nearly 40%, illustrating the stark contrast in outcomes due to the challenges faced in the Bitcoin mining industry.
The Bitcoin halving in April significantly reduced miners' rewards, forcing companies like Marathon to adapt by holding onto mined Bitcoin rather than investing in new mining equipment.
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