In February, Marathon Digital (MARA) posted a seven-fold increase (729%) in bitcoin production. Still, MARA stock broke down from the $25 support level. Riot Blockchain (RIOT) posted production of 436 bitcoin in February, up 189% Y/Y.
MARA and RIOT stock are not reacting positively to the increased production. Bitcoin’s decline in the last week pulled both crypto mining firms lower.
Marathon’s increased hash rates are a notable development. It successfully deployed 2,800 miners in February. Furthermore, it received around 7,600 ASIC miners from BITMAIN. It now has 35,500 active miners that produce ~ 3.8 EH/second. By mid-2022, Marathon’s hash rate will rise to ~13.3 EH/s. By early 2023, it will run at 23.3 EH/S.
Investors are ignoring Marathon’s strong upside ahead. In Q4/2021, it mined 1,098 bitcoin, despite maintenance activities to the power generating station. On its balance sheet, it had $268.5 million in cash and cash equivalents. A strong cash balance is enough to cover unexpected costs. In addition, it will not need to rely on the weakening stock markets to raise cash.
Your Takeaway
Cryptocurrency investors should consider mining firms. They have strong prospects over the next few years. Marathon is especially compelling because it has machines dedicated to mining bitcoin. Bears may have the upper hand on the stock’s performance. The short float is almost 22%.
