US Bitcoin Miners Hoard Apex Crypto To Shield Against Rising Expenses — MARA, Riot Replicate MicroStrategy's Playbook

Aniket Verma

January 8, 2025

Benzinga

Leading Bitcoin (CRYPTO: BTC) miners in the U.S. are accumulating BTC as a buffer against growing competition and narrowing profit margins.

What Happened: Firms including MARA Holdings Inc. (NASDAQ:MARA), Riot Platforms Inc. (NASDAQ:RIOT), and CleanSpark Inc. (NASDAQ:CLSK) have leveraged Bitcoin’s soaring price, which hit $100,000 last month, to raise over $3.7 billion since November, according to a Financial Times report on Monday.

These funds have been utilized to fund Bitcoin purchases, often raised through zero or near-zero coupon convertible notes.

Following in the footsteps of MicroStrategy, MARA, the world’s biggest Bitcoin mining company, has pivoted toward a buy-and-hold strategy, retaining all Bitcoin it mines and periodically making strategic open-market purchases.

Miners such as CleanSpark have also chosen to retain the majority of the Bitcoin mined in recent months.

On-chain data also reflected the behavioral shift. The number of Bitcoins transferred from miner wallets to exchanges fell sharply in the last quarter, coinciding with the cryptocurrency’s uptrend, according to blockchain analytics firm CryptoQuant.

MARA was the second-largest corporate holder of Bitcoin, with a stash of 44,893 BTCs, worth $4.3 billion, with Riot bagging the third spot with 17,722 BTCs valued at $1.69 billion, according to bitcointreasuries.net.

Why It Matters: This strategy is a significant shift in the industry’s perspective, which has been grappling for the past eight months after the reward for mining Bitcoin halved.

Donald Trump’s pledge that Bitcoin would be “mined, minted, and made in the U.S.” has ignited enthusiasm, with MARA CEO Fred Thiel attributing recent momentum to the supportive stance of the president-elect.

The rush to purchase more Bitcoin is also a defensive tactic against potential financial pressure from high electricity costs.

Mining costs are on the rise. A report by leading investment firm CoinShares estimated the average cost to produce one Bitcoin in the third quarter of 2024 at $55,950, indicating a 13% increase quarter over quarter. One Bitcoin was trading at $95,995.51 as of this writing.

Additionally, hash rate, the computation power required to solve complex puzzles and create new Bitcoins, hit a new all-time high last week, threatening to drive up expenses even more.

Price Action: Shares of MARA closed 7.20% lower at $19.07 on Tuesday, while RIOT stock fell 3.72% to $12.41. CleanSpark shares closed down 6.30% at $10.71, according to data from Benzinga Pro.

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