Bitcoin miner Marathon Digital (MARA) plans to expand operations as bitcoin rebounds heading into 2024. MARA stock rallied nearly 180% during its impressive nine-week run stretching back to early October. Meanwhile, bitcoin has bolted about 52% since the beginning of October and is approaching $43,000.
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Marathon Digital provides the computing power to mine bitcoins, which consists of processing and validating transactions. The company regards its mined cryptocurrency as revenue. The faster it can process transactions, the more revenue Marathon generates. Marathon can also sell its mined bitcoin for additional revenue.
Marathon Digital produced 1,187 bitcoin in November, the company announced on Dec. 5, bringing the year-to-date total to 10,999 BTC. The firm’s hash rate, or speed it can mine bitcoin, rose by 20% during the month to 23.1 exahashes per second, making it the largest bitcoin miner in North America.
As of Nov. 30, Marathon held 14,025 unrestricted bitcoin. The company chose to sell 700 BTC, or 59% of monthly production, to cover operating expenses. Marathon said intends to sell a portion of its BTC holdings in the future to support its monthly operations. At the end of November, Marathon Digital held $273.1 million in cash and equivalents. Meanwhile, its unrestricted cash, equivalents and bitcoin increased to $802.3 million from $620.3 million.
Early Tuesday, Marathon Digital announced it agreed to purchase two bitcoin mining sites for $178.6 million in cash from subsidiaries of Generate Capital.
The two sites offer 390 megawatts of mining capacity and increase Marathon Digital’s mining portfolio by 56% to 910 megawatts. They will be Marathon’s first full-owned sites as it shifts from utilizing third parties to a more integrated mining operation. Once the deal closes, which is expected in Q1, Marathon will directly own 45% of its mining sites.
MARA Stock
Marathon Digital shares spiked 10.5% Tuesday following the mining site news. MARA stock bolted 206% during its nine-week rally from its Oct. 6 low of 7.16.
MARA stock vaulted more than 542% so far this year. Shares are in a buy range above a 19.88 buy point, and trading at their highest level since April 2022.
Bitcoin price traded near $42,300 Tuesday from around $28,000 at the beginning of October. The crypto is gaining steam on expectations of bitcoin exchange-traded fund approvals early next year as well as potential interest rate cuts. Bitcoin spiked 155% in 2023.
You can follow Harrison Miller for more stock news and updates on X/Twitter @IBD_Harrison
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