With bitcoin hitting all-time highs this week, cryptocurrency is again in the spotlight, and shares in crypto mining stocks have seen a surge in interest. It comes on the back of the Securities and Exchange Commission (SEC) giving approval to the first bitcoin futures ETF to list on the US stock market.

Crypto miners generate income directly from ‘mining’ digital currencies, which involves mining rigs solving computational problems to verify transactions. Industry Research suggests the global cryptocurrency mining market could grow at a CAGR of 16.8% to reach nearly US$2.6 billion by 2026. 

The sector has seen a number of new names emerge as companies look to capitalise upon the upswing, even tackling the environmental issues often associated with the industry’s energy usage. On that note, let’s take a quick look at 10 names in the crypto mining space.

 

 

HIVE Blockchain Technologies (NASDAQ: HIVE)

Based out of Vancouver, Canada, HIVE was the first publicly-traded crypto miner, listing on the Toronto Venture Exchange in 2017, but today sharing a dual-listing on the Nasdaq. The company also has data centres in Iceland and Sweden that it draws upon to power its crypto mining operations, which include bitcoin and ethereum. 

HIVE built its facilities in these jurisdictions to take advantage of cooler temperatures and access low-cost green and renewable energy, which it uses exclusively for mining. In the June quarter, HIVE recorded record revenue of US$37.2 million and net income of US$18.6 million, while also expanding its mining capacity.

 

Stronghold Digital Mining (NASDAQ: SDIG)

The newest name on the block, Stronghold Digital Mining made its debut this week, with the stock soaring more than 50% from its IPO price.

Pitching itself as one of the first vertically-integrated and environmentally-conscious crypto mining stocks, Stronghold converts coal refuse, a form of waste left over from coal mining, into power for its mining operations, which also earns it tax credits and renewable energy credits. The company currently operates 3,000 miners, powered by its wholly-owned power plant in Pennsylvania. 

After securing US$100 million in fresh funding, Stronghold is hopeful of acquiring other environmentally-focused power-generating assets, as well as lifting its total hashrate from 185 petahash per second (PH/s) to 2,100 PH/s by December.

 

Marathon Digital (NASDAQ: MARA)

With a gain of more than 1,000% in 2020 alone, Marathon Digital surged to life as crypto prices soared. This Las Vegas-based company is striving to build the largest mining operation in North America at one of the lowest energy costs thanks to its access to ‘cheap’ energy. 

It has co-located its ‘Bitcoin Mining Data Center’ adjacent to the Hardin Generating Station, a 105MW power facility in Montana. It has the capacity to deploy up to 30,000 mining rigs that will generate 3,320 PH/s. 

Recently, Mathon Digital developed a mining pool called MaraPool, which is a joint group of crypto miners who combine their computational resources over a network to increase their prospects of finding a block and mining crypto. MaraPool is fully audited by a third-party, and unlike other mining pools it has been designed to offer greater transparency to members.

 

Canaan (NASDAQ: CAN)

Unlike some of the other names on this list, Canaan offers exposure to the supercomputing hardware that is used for crypto mining. The Chinese company is riding the tailwinds of a booming segment as an ever-growing number of mining players invest in equipment to drive their operations. 

Formed in 2013, Beijing-based Canaan specialises in blockchain servers and application-specific integrated circuit (ASIC) microprocessor solutions. The company recently announced its strongest quarterly sales ever, with total net revenue up more than 500% in the June quarter versus a year prior, while total computing power sold soared as demand for bitcoin mining machines took off.

 

Riot Blockchain (NASDAQ: RIOT)

Based out of Colorado in the US, but with operations in New York, Riot Blockchain is among the largest US-based publicly-traded bitcoin miners in North America. The company has been investing in its bitcoin mining operations as it builds scale. Its NY facility is hosted by Coinmint at the largest digital currency data centre in the world, where energy is drawn from 88% zero-emission sources.

Earlier this year, Riot announced it would acquire Whinstone US, the Texas-based owner-operator of North America’s single largest bitcoin mining and hosting facility. In recent days, the company has announced the development of 200MW of immersion-cooling technology at this facility to drive higher productivity rates and hash rates. By the end of 2022, Riot expects to have a fully-deployed fleet of miners in excess of 80,000.

 

 

BIT Mining (NYSE: BTCM)

Headquartered in Hong Kong, BIT Mining is a crypto mining enterprise that not only undertakes mining operations, but has exposure to mining machine manufacturing, data centre operations, and mining pools. In terms of the latter, it owns the entire mining pool and associated assets operated via BTC.com, one of the most popular industry names.

The stock has been at the centre of a Reddit-driven trading frenzy, often touted as a short-squeeze target. Last month the company entered into a US$12.1 million agreement with Viking Data Centers to develop an 85MW crypto mining facility in Ohio, USA, with completion forecast for February 2022. A crackdown on crypto miners in China has pushed a number of operators, including its mining pool subsidiary BTC.com, to exit the mainland China market and head to jurisdictions like the US.

 

BIT Digital (NASDAQ: BTBT)

Another stock often mentioned by the Reddit forums as a potential short-squeeze play, BIT Digital is a sustainability-focused generator of digital assets with large-scale, and global mining operations representing a currently-owned maximum hash rate of 1,920 PH/S.

The NY-based crypto miner has one of the largest operating fleets of any US-listed miner, currently totalling 32,500, with the majority of its miners running on carbon-free power.

In the June quarter, BIT Digital mined nearly 563 Bitcoin, which comes as it also relocates operations away from the Chinese market. The company struck an US$80 million financing arrangement and recently signed a co-mining agreement with Blockfusion to improve its hashrate.

 

Bitfarms (NASDAQ: BITF)

Bitfarms is a Toronto-based blockchain infrastructure company with one of the largest crypto mining networks in North America. Across its five facilities in Quebec, and 82MW of built-out infrastructure, 99% of its bitcoin mining activities are powered by renewable hydroelectric power, with an average cost of just US$0.04/kWh, and corporate hash rate of 1,600 PH/S.

As a point of differentiation, Bitfarms is a vertically-integrated company thanks to its wholly-owned electrical contractor, Volta Electrique, and its own network of electrical contractors. In terms of its future pipeline, Bitfarms is forecasting another 105MW of built-out infrastructure capacity over coming months.

 

Greenidge Generation (NASDAQ: GREE)

Following its recent merger with Support.com, Greenidge Generation is another NY-based company operating within the cryptocurrency space. The company operates power-generation facilities, including its own carbon-neutral power plant, which is at the centre of its bitcoin mining activities. 

It produces about 44MW of energy for more than 15,000 miners, but with the plant boasting a capacity of 106MW it also sends excess electricity into the state’s power grid. Between January and June, nearly 60% of power generated by the company was used for bitcoin mining. 

More recently, the company was able to mine 729 bitcoin in the September quarter, with preliminary results pointing to between US$33 million and US$37 million in revenue. In September it announced the purchase of another 10,000 miners for its planned new facility in South Carolina.

 

Hut 8 Mining (NASDAQ: HUT)

Another Canadian crypto miner that has made a name for itself in recent times, Hut 8 Mining completed a Nasdaq listing in June this year. It focuses on bitcoin and ethereum, mining 326 bitcoin in August, 2021, representing average production of 10.5 BTC per day.

During the second quarter of the year Hut 8 Mining generated CAD$33.55 million in revenue, which was more than 250% higher than the prior corresponding period. Operating income also increased by a similar amount. Whereas some bitcoin miners sell the BTC they mine, Hut 8 Mining takes a different approach. It is the number one holder of self-mined bitcoin in North America and lends out its BTC to generate interest on the assets.

The company is in the midst of expanding its operations, with its hashrate already increasing to 1,370 PH/s as it looks to achieve upwards of 2,500 PH/s by the end of the year. It is also looking to boost power capacity from 144MW to 209MW by 2022. Like some other players, Hut 8 Mining is eyeing sustainable operations, with its rigs in Alberta, Canada, powered by electricity generated by a mix of solar, wind and natural gas. This has helped the company achieve the lowest mining rig costs among publicly-traded BTC mining companies at $0.022 per kWh.

 

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