Marathon Digital Holdings (MARA), one of the largest publicly traded Bitcoin mining companies, has recorded significant advances in its cryptocurrency accumulation strategy. In an announcement on November 27, the company said it acquired 6,474 Bitcoin (BTC) during the month.
This brings the company’s total Bitcoin holdings to 34,794 BTC, currently worth approximately $3.3 billion based on Bitcoin’s trading price of around $95,000 per coin.
Marathon Digital Affirms Its Position as One of the Top Bitcoin Holders
These purchases were funded through Marathon’s recent $1 billion zero-coupon convertible bond issuance. The report shows the company earned $980 million after transaction costs. The company used $200 million of this to repurchase part of the bonds due in 2026.
Marathon Digital said it has set aside $160 million in cash reserves for future Bitcoin purchases, especially if the cryptocurrency’s price drops.
“…$160 million remaining in revenues after deducting transaction costs for future BTC dip purchases,” the company said. said.
With recent purchases, Marathon Digital has solidified its position as the 2nd largest holder of Bitcoin, second only to MicroStrategy. While MicroStrategy dominates with 1.8% of the total Bitcoin supply, Marathon’s assets account for about 0.16%, a notable position in the growing trend of businesses accepting Bitcoin.
“Bitcoin is definitely something every company should have on their balance sheet,” Marathon CEO Fred Thiel stated recently in an interview.
Thiel also emphasized Bitcoin’s scarcity and its potential as a shield against inflation and fiat currency depreciation. Meanwhile, Marathon’s shopping spree reflects a broader trend among publicly traded companies.
According to data from Bitcoin Treasuries, public enterprises have increased their holdings from 272,774 BTC to 508,111 BTC since the beginning of the year. In November alone, companies bought more than 143,800 BTC, a significant increase from about 2,400 BTC purchased in October.
Strategic Move Drives Bitcoin Adoption
MicroStrategy has led the wave, adding more than 130,000 BTC in November, including a memorable intraweek purchase. However, many other companies also joined the race to accumulate Bitcoin.
For example, Rumble, a video sharing platform, has announced plans to set aside up to $20 million in reserves to invest in Bitcoin. The decision comes after CEO Chris Pavlovski received encouragement from MicroStrategy’s Michael Saylor to adopt Bitcoin as a treasury asset.
Similarly, Genius Group, a company focused on artificial intelligence, bought $14 million worth of Bitcoin earlier this month. Dedicating 90% of its reserves to Bitcoin, Genius Group seeks to increase its investment in Bitcoin to $120 million.
Marathon’s recent Bitcoin purchases and financing are part of a broader expansion strategy. The company’s $1 billion convertible bond issuance is the second largest capital raising initiative in 2024, after successfully calling for $250 million in capital in July. That capital call also aimed to consolidate strengthen Bitcoin reserves and expand mining operations.
As TinTucBitcoin reported, Marathon emphasized its commitment to expanding operations while maintaining a strong Bitcoin reserve strategy.
“With interest-free financing secured, we are strategically positioned to capitalize on market opportunities and strengthen our leadership role in the Bitcoin mining sector,” the company said. noted.
Marathon’s aggressive strategy of Bitcoin purchasing and financial planning has been well received by the market. The company’s shares closed up nearly 8% on Wednesday, with year-to-date gains of approximately 14%, according to data from Yahoo Finance.
Analysts attribute the stock’s performance to Marathon’s ability to leverage financial resources to grow. They are in line with the broader market’s enthusiasm for Bitcoin. The cryptocurrency’s 2024 bull run has sparked renewed interest from institutional and corporate investors, with Bitcoin prices recently surpassing $95,000 per coin.
However, the company still faces revenue challenges and a change in strategy amid the volatility of the cryptocurrency market. Specifically, one of the challenges is meeting earnings expectations third quarter (Q3) of analysts. The Bitcoin miner reported a loss of $0.24 per share, slightly worse than the forecast loss of $0.23 per share. This resulted in an earnings surprise of -4.35%.
In light of these challenges, Marathon Digital Holdings has diversified its operations beyond traditional Bitcoin mining. In addition to mining operations, the company is also exploring opportunities in the field of artificial intelligence (AI) and other emerging technologies. These could help reduce the company’s dependence on Bitcoin price fluctuations and position it for growth in high-tech industries.