Marathon Shifts Strategy Ahead of Bitcoin Halving

Marathon Digital Holdings' recent quarterly earnings report revealed new specific strategies about the Bitcoin mining firm, ahead of the Bitcoin Halving event expected sometime next year. In addition to robustly enhancing its hash power, the company is now shifting towards an international joint venture model for continuing its expansion.

The preparations which the BTC mining firm is seen as a way of pivoting its strategies for the impending BTC Halving, which, based on current mining speeds, is expected to occur in about half a year. 

Eyeing International Expansion

With a notable 19.2 EH/s (exahashes per second) online, Marathon stands out as the biggest public miner according to hash rate; it also holds the title for the most significant public miner by Bitcoin possessed (held amounts only, not inclusive of internalized transfers), proudly owning 13,396 BTC currently valued at an impressive $474 million.

The report also indicates that Marathon has elevated its Bitcoin production by 467% within a year, increasing its hash rate from 7 EH/s this time just last year. This improvement has allowed the company to reach BTC production from 416 (Q3 2022) to an astonishing 3,490 BTC (Q3 2023).

According to the report, Marathon is likely on the verge of accomplishing its 23 EH/s target soon, thanks to the operationalization of its Garden City, Texas facility early this November. Although the plant's energization has been postponed since July, it is projected to be fully operational later this month with 4.1 EH/s.

Nonetheless, the company stated that it is shifting focus onto international joint ventures. This strategic move could see Marathon become the most geographically varied miner and methodically lower manufacturing expenses over time.

Marathon has grown tired of the high overhead and continued energization delays at its US facilities. Its strategy for 2024 includes a 30% expansion achieved through the establishment of new plants in Abu Dhabi and Paraguay.

Though Marathon’s cost structure has seen improvements, it remains relatively high compared to its competitors. In the wake of the halving, the firm could see its profit margin getting pinched if Bitcoin prices dip below $30,000.

“As Marathon is getting its final US-based hosted facilities online, it focuses more on scaling internationally through joint ventures with local partners,” the firm shared in a press release.

Bitcoin Mining Sector: Outlooks

Marathon Digital Holdings' strategic shift towards international expansion and increased hash power is evident in their recent activities. The firm's move into renewable-powered Bitcoin mining in Paraguay, following a successful venture in Abu Dhabi, marks a significant step towards diversifying and reducing operational costs. With this stance, Marathon stands as the industry's fastest-growing public miner.

Notably, however, in lieu of the Bitcoin Halving, Marathon faces challenges in maintaining cost efficiency. Despite an improved financial standing, with net income reaching $64.1 million in Q3 2023 and a reduction in long-term debt, the company must navigate the halving's impact on profitability and continue its strategic global expansion to sustain its growth trajectory.

The daily average hash rate of the Bitcoin network currently sits at 428 EH/s, nearing its record peak. This development increases the pressure on rival miners striving for the next block.

As for competition, the difficulty factor, representing the 'work' levels required to mine on the network, has reached the maximum at 64.6T. Despite the surge in prices, mining profitability, or the hash price, remains low. It presently stands at $0.079 per TH/s per day as listed by the Hashrate Index.

At the time of writing, Bitcoin is trading at the $35,600 level, down by 4.6% for the past week.

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.