Marathon Digital Continues Mining Despite BTC Price Plunge

Although data shows that Bitcoin (bitcoin) prices may have fallen to the point where ordinary miners are unprofitable, and Marathon Digital Holdings said it will continue its efforts to accumulate the leading crypto asset.

Charlie Schumacher, vice president of corporate communications at Marathon Digital, told Cointelegraph on June 15 that while the company is “not immune to the macro environment,” electricity prices are fixed due to low operating costs.

“For reference, in the first quarter of 2022, it costs us about $6,200 to produce bitcoin. We also have fixed electricity pricing, so we are not affected by changes in the energy market.”

Schumacher added that the company is more focused on its bitcoin production and accumulation of the crypto asset, which he believes will continue to appreciate in the long run.

“Because we report our finances in U.S. dollars, the price of bitcoin will always have a significant impact on our financial performance. To objectively assess our internal progress, we try to focus more on our bitcoin production. Important The thing to remember is that Bitcoin mining is a zero-sum game,” he added.

“Of course, bitcoin is less valuable in dollar terms when it is mined, but if you believe in bitcoin’s ability to appreciate in value over the long term, earning more bitcoin is never a bad thing.”

on June 9 statement, Marathon said it has been accumulating or “hoarding” its bitcoins and hasn’t sold any since October 2020. As of June 1, 2022, Marathon holds about 9,941 BTC, which is worth about $200 million at current prices.

keep mining

In fact, Schumacher pointed out that as the price of Bitcoin falls, so does the number of people who can continue to mine profitably, which will force inefficient miners out, while also reducing the difficulty of mining new blocks.

“When the difficulty drops, those who are able to continue mining have the opportunity to earn more bitcoin.”

Bitcoin’s current hash rate, also known as Bitcoin’s processing power, is calculated from All-Time High (ATH) From 231.428 EH/s on June 12 to 205.163 EH/s at the time of writing.

The impact was even more pronounced a year ago after China cracked down on cryptocurrency mining facilities, Hashrate market peak From 180.666 in May 2021 to 84.79 in July 2021.

The price is in line with the average cost of mining

Last week, crypto market data and analysis platform CryptoRank highlighted that on June 16, the price of BTC was on par with the average cost of mining, noting that for some, mining may not even be profitable at the moment.

Markus Thielen, chief investment officer at digital asset management firm IDEG Singapore, told Cointelegraph that the mining industry could have an impact, as most people set their budgets for the fourth quarter of 2021 before market conditions changed.

“We actually expect some issues as most miners appear to have set their budgets for 2022 early in Q4 2021 and market conditions have changed significantly.”

Thielen said they estimate breakeven rates for some smaller miners without economies of scale will be between $26,000 and $28,000. At the time of writing, Bitcoin is currently trading at $20,085.

related: Bitcoin’s Weekly Closing Dismal as BTC Price Drops to $20,000

Last week, a report by S3 Partners identified Marathon Digital Holdings as one of the U.S. public companies Most Shorted Interest Together with MicroStrategy and Coinbase.