Marathon Digital Holdings, one of the biggest publicly traded bitcoin miner, had one of the first loss during their first quarter with the company stating:
“Despite higher earnings contributions resulting from the expansion of the Company’s bitcoin mining operations, GAAP net loss for the quarter totaled $13.0 million, or ($0.13) per share, compared to net income of $83.4 million, or $0.87 per diluted share, in the prior-year quarter.”
They increased bitcoin production to 1,259 BTC, up 556% over last year and up 15% from the fourth quarter of 2021.
But the revenue of $51.7 million was an $8.6 million decrease, or 14% lower, than Q4 2021. So what happened here is that bitcoin’s price fell by 30% more than their production increased, and so we get a loss.
Which is bad news for the company, but pretty good news for holders because mining a bitcoin now costs more than its market price. Something that should kick in certain market forces whereby miners hold off selling their coins so as to withdraw supply to put a floor on the price or end up bankrupt.
Digihost (DGHI) has not yet filed a quarterly report. They say the company mined “an additional 33.44 BTC during April 2022 compared to March 2022, an increase of 44%. Based on closing BTC prices on April 30, 2022 and March 30, 2022, the value of the Company’s BTC mined in April increased by approximately $0.7 million, or 20%, month over month.”
Northern Data also just give a monthly update, stating: “A total of 324 Bitcoin and 4,583 Ethereum were generated in April 2022. As of end of April 2022, Northern Data held 1,390 BTC and approx. 39,800 ETH, which at current exchange rates (BTC/EUR 35,770; ETH/EUR 2,589) equates to a value of all cryptocurrencies held of approx. EUR 153 million.”
So one quarterly report is showing a loss while others are perhaps delaying the publishing of their quarterly report.
Indicating miners probably didn’t have a good quarter, which from a price perspective means bitcoin is undervalued as it is trading below the cost of production.