Despite the continued decline in the price of bitcoin and the turmoil in the markets today, some of the largest mining companies are not concerned and insist that their operations will not be affected by negative price fluctuations.
Some see it as an opportunity to gain market share as smaller competitors collapse.
Bitcoin (BTC) prices have been on a steady decline all year long until the last 24 hours, when the crash accelerated to reach its lowest point since December 2020. However, miners were not deterred amidst this massive pressure. Some may have more enthusiasm for mining if Bitcoin’s downtrend continues into 2022.
Each of three different miners – two large public companies and one private mining company – came to Cointelegraph to share their wonderful feelings about the possibility of a bear market. They think it will have little impact on their business plans.
Bitcoin miner Marathon Digital Holdings (MARA) said its “light asset strategy” will keep it aloof from virtually all bear market influences. Charlie Schumacher, Vice President of Corporate Communications, told Cointelegraph that it maintained a cost basis of about $6,200 per BTC mined in the first quarter by “outsourcing our process power and maintaining intellectual strength within the company.”
Marathon is the third largest holder of Bitcoin (BTC) among public companies according to BitcoinTreasities. It has the ability to generate 3.9 exahashes (EH/s) of hash power. MARA is down 15.42% and is trading at $9.97 in the after-hours trading. It is down 92.6% from its December 2014 high of $134.72.
Schumacher added that the exit of other miners due to capital constraints during bear markets creates an opportunity for larger operations like Marathon which can benefit from lower mining difficulty from reduced hashing power and competition on the Bitcoin network.
“Due to the lower hash rate, there is a downward difficulty adjustment, which reduces the energy expenditure of miners who remain in the hash. Those who have left can thus benefit by earning more bitcoins.”
Cointelegraph also received responses from Jason Lee, CEO of Riot Blockchain (RIOT), another large mining company. It currently ranks 8th in terms of BTC among public companies according to Bitcoin Bonds. The company controls 3.9 EH/s of hash power as of March 4 but has not disclosed its cost per coin mined.
RIOT is down 9.16% and is trading at $6.83 in the after-hours trading. It is down 90.5% from its February 2021 high of $71.33.
Leh also seemed indifferent about the current and future volatility of the bitcoin market. Like Marathon and Redider, Lees cited his company’s “strong balance sheet with no long-term debt” as the main strengths he can count on from a business perspective. He added, “Changes in bitcoin market conditions do not affect our miner deployment plans, so we continue to increase our hash rate monthly.”
“Riot’s miner deployment plans are not affected by volatility in Bitcoin, and we are focused on building a sustainable business that operates in the Bitcoin pool market conditions.”
Reddivider CEO Tom Frazier is also unfazed by the prospect of a more protracted downturn. Redider is a privately run data center provider for Bitcoin mining that specializes in opportunity areas designed to benefit workers in underserved areas of the United States.
The core of the 1.5-year-old Redvider’s business is managing data centers from which miners can rent their Bitcoin hash power for a fee. Frazier told Cointelegraph in a May 11 call that if its data centers do not have tenants at any given time, Redvider can maintain revenue streams for all of its facilities at any given time by assuming hash power and block rewards for themselves.
He did not disclose the base price of Redider for each Bitcoin mined nor the volume of its operations, but emphasized that “our production price of BTC will not be affected.”
Frazier said the downturn in the bitcoin market “has little impact on what we’re doing because of our 10-year plan.”
Corrections are happening in the market because Bitcoin is very volatile, which is in line with any other volatile asset class. This volatility will not hinder our strategy. These moments present opportunities.”
Related: Bitcoin Struggles to Hold $29,000 as Fear of Regulation and Terra Treasure Collapse Hit Crypto Hard
Given the current turmoil in the crypto markets after the Terra (LUNA) project collapsed and Bitcoin is currently trading at $28,931, its lowest since January 1, 2021, according to CoinGecko data, it may soon become clear whether miners can pounce on the opportunity on their doorstep. as they claim.