Battling the Bear: Crypto Miners Push Forward
In the face of Bitcoin’s recent three-month downturn, two major players in the U.S. crypto mining sector are doubling down on their operations, planning to significantly scale up their hardware by the end of 2022. It’s like they woke up one morning and decided to ignore the ‘bear’ in the room!
Marathon’s Massive Machine Maneuver
Marathon Digital Holdings is making some impressive moves, planning to deploy a staggering 199,000 new machines by 2023. According to Charlie Schumacher, the vice president of corporate communications, this step is crucial for securing what many dub the “future of the global monetary system.” Talk about putting the pedal to the metal!
GEM Mining: Doubling Down on Miners
Not to be outdone, GEM Mining’s CEO, John Warren, shared via email that his company plans to have 32,000 miners online by the end of 2022. This expansion would effectively double GEM’s operational capacity. Maybe they’ve been binge-watching ‘how to scale your business’ YouTube videos?
Capital Concerns and Strategic Moves
Interestingly, as these miners expand their operations, questions about capital efficiency have surfaced. Reports indicate some miners are offloading their BTC to maintain cash reserves, and Marathon recently filed with the SEC to sell up to $750 million worth of stock. But Schumacher reassures us that this filing isn’t a desperate move—it’s all about “increasing optionality.” It’s like they have a backup plan for their backup plan!
Tax Incentives: A Bright Light in the Tunnel
The optimism from GEM and Marathon is not unwarranted, especially with potential new tax incentives on the horizon. Illinois and Georgia are considering proposals that would offer tax breaks for crypto mining operations, which could significantly alleviate overhead costs.
- Illinois: Tax breaks for crypto mining data centers
- Georgia: Reduced taxes on electricity used for mining
Warren emphasizes, “Energy is one of the most significant inputs for mining operations, and tax breaks can assist with reducing overhead costs.” Who knew tax laws could be the real MVP in crypto mining?
Market Volatility: The Elephant in the Room
Both executives acknowledged the potential for turbulence in the Bitcoin market in the coming months. Schumacher prefers to sidestep labeling it a “crypto winter,” focusing instead on minimizing risks and pivoting as needed. Meanwhile, Warren foresees “short-term bearish sentiment” but remains optimistic about continued investment in Bitcoin and the broader crypto landscape. You could say they’re taking a “glass is half-full” approach—while wearing shades.
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