A bitcoin mining behemoth makes buy to get even bigger

Marathon Digital is set to add its first fully-owned sites in Texas and Nebraska as part of a $179 million cash deal

share

Marathon Digital expects to add 390 megawatts to its bitcoin mining capacity via an acquisition that could spur the doubling of its hash rate in the next couple years.

The Florida-based miner is buying two bitcoin mining facilities — in Granbury, Texas and Kearney, NE — from Generate Capital affiliates for $178.6 million in cash, the company said in a Tuesday news release. 

The move is set to give Marathon Digital — whose mining capacity is now mostly hosted by third-parties — its first fully-owned sites. Just 3% of the company’s 584 megawatts of capacity are housed in sites that it owns and operates. That will change to 45% after the deal closes. 

In addition to expanding operational capacity, the transaction is set to allow Marathon to reduce its bitcoin production costs at the sites by roughly 30% and “capitalize on energy hedging opportunities,” Marathon CEO Fred Thiel said in a statement. 

“For the past year, Marathon has been vertically integrating as we transition into a more sophisticated and mature organization with a diversified portfolio of bitcoin mining technologies and assets, and the acquisition of these sites is the next step in that evolution,” Thiel added.

Marathon Digital is North America’s largest miner by hash rate — increasing its domestic energized hash rate by 20% in November to 23.1 exahashes per second (EH/s). Core Scientific, which intends to exit its bankruptcy by year’s end, was close behind at 21.6 EH/s as of Nov. 30. 

The latest buy gives Marathon a chance to double its hash rate to roughly 50 EH/s in the next 18 to 24 months, the company said Tuesday. 

The expected increase comes as competitors have also plotted major growth ahead of the next bitcoin halving, slated for April, when per-block mining rewards are reduced from 6.25 bitcoin (BTC) to 3.125 BTC.   

Read more: Crypto miners keep busy ahead of halving with accelerated machine buys

Riot Platforms earlier this month made the largest hash rate purchase in the company’s history, acquiring 66,560 MicroBT machines for $290.5 million. 

Riot’s deployed hash rate was 12.4 EH/s at the end of November. But the company said options to buy more MicroBT machines could help it add 75 EH/s to the company’s self-mining capacity in the long term.

Also in recent weeks, Bitfarms bought 36,000 Bitmain T21 miners as part of “a transformative fleet upgrade plan,” and the merger between Hut 8 and US Bitcoin Corp closed

This isn’t Marathon’s first big move of the year. 

It has focused on expanding globally and diversifying mining methods in recent months — now with 2.5 EH/s and 0.2 EH/s online in Abu Dhabi and Paraguay.


Don’t miss the next big story – join our free daily newsletter.

Tags

Upcoming Events

Hilton Metropole | 225 Edgware Rd, London

Mon - Wed, March 18 - 20, 2024

Crypto’s premier institutional conference returns to London in March 2024. The DAS: London Experience: Attend expert-led panel discussions and fireside chats Hear the latest developments regarding the crypto and digital asset regulatory environment directly from policymakers and experts.

Salt Lake City, UT

WED - FRI, OCTOBER 9 - 11, 2024

Pack your bags, anon — we’re heading west! Join us in the beautiful Salt Lake City for the third installment of Permissionless. Come for the alpha, stay for the fresh air. Permissionless III promises unforgettable panels, killer networking opportunities, and mountains […]

recent research

Research report - cover graphics (1).jpg

Research

In this report, we dive into crypto private market data to gather insights on where the future of the industry is headed. Despite a notable downturn in private raises, capital continues to infuse promising projects that aim to transform payments, banking, consumer experiences, community, and more, with 2023 being the fourth-largest year for crypto venture capital.

article-image

BUZZ holds shares of Coinbase, Robinhood and MicroStrategy

article-image

Opinion: Even though I didn’t pay for my “Diamond Hands” burger with BTC, don’t let that fool you into thinking that crypto’s development is futile

article-image

The results mark “a major positive inflection point,” one analyst says, as the exchange carries net income momentum into a crypto rally

article-image

While the slate of 10 US spot bitcoin funds have tallied $4.6 billion of net inflows thus far, half of the field is lagging the leaders

article-image

Trading volumes totalled $154 billion in Q4, including $125 billion in institutional volume

article-image

DeFi on Bitcoin is all the rage right now and Stacks is positioned to benefit