Mining Firm Marathon Joins MicroStrategy as De Facto Bitcoin Investment
Bitcoin mining firm Marathon has swapped cash for Bitcoin, joining MicroStrategy and others.
Key Takeaways
- Marathon Patent Group, Inc. has disclosed a $150 million Bitcoin purchase during the recent dip.Â
- The mining firm's BTC investment makes it a proxy for Bitcoin exposure alongside MicroStrategy.Â
- The American public-listed firm has planned to expand its mining hash capacity more than tenfold this year.Â
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American Bitcoin mining giant and publicly-listed company Marathon Patent Group, Inc. (MARA) has revealed a $150 million BTC purchase at an average price of $31,167.8.
Marathon Goes All-In on Bitcoin
Marathon Patent Group, Inc. used the financial services of NYDIG, a subsidiary of Stone Ridge Capital LLC, to execute the trade and corporate treasury solutions.
While MicroStrategy added only $10 million BTC on the recent Bitcoin dip, Marathon Patent Group bought $150 million BTC.
Marathon recently completed its $200 million capital raise via a shelf offering. As a result, the company ended the 2020 fiscal year with $217.6 million in cash and 74,656,549 shares outstanding.
The American mining giant also purchased 103,060 miners, for which the company owes Bitmain around $163 million spread throughout this year subject to delivery. The firm has thus effectively planned to invest in exclusively Bitcoin throughout the year.
Thus, its $150 million Bitcoin bet is no less significant than MicroStrategy’s levered BTC holdings of over $2 billion.
Merrick Okamoto, Marathon’s chairman and CEO, said:
“We also believe that holding part of our Treasury reserves in Bitcoin will be a better long-term strategy than holding US Dollars, similar to other forward-thinking companies like MicroStrategy.”
The company is America’s largest mining firm to begin converting its cash balances to BTC, suggesting that buying shares in Marathon is a proxy for buying BTC.
Marathon’s share price surged over 20x within twelve months, rising from less than a dollar to a peak of $23.2 on Jan. 11, corresponding with Bitcoin’s recent top of $42,000.
MARA is currently changing hands at $19.5 and BTC at $33,831.18.
Disclosure: The author held Bitcoin at the time of press.
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