BTC Mining Companies Operational Updates

October 8, 2021 11:30 AM
Crypto Story of the Day

Crypto Story of the Day




Crypto was broadly down this morning. Activity in the cryptocurrency Reddit forum has fallen to levels previously seen in early July.

Crypto Story of the Day

A number of publicly listed BTC mining companies have released operational updates for the month of September. We review the production metrics of select firms and compare price performances between equities and BTC.

Argo Blockchain (LSE: ARB): In September, the London-based company mined BTC 165, representing a 20% decrease from its August production numbers. Argo reported revenue of USD 7.59M during the month, compared to USD 9.43M in August. The company has mined 1,479 coins year-to-date and held 1,836 coins at month-end, valued at USD ~80.5M. Argo’s stock has been up ~2440% over the past 12 months.

Riot Blockchain (NASDAQ: RIOT): Riot’s September production more than quadrupled month-over-month, mining BTC 406 in the month compared to BTC 91 in August. Year-to-date, Riot has mined 2,457 coins, representing a 236% increase over the same period in 2020. As of month-end, the company held 3,534 coins worth USD ~155M. The Nasdaq-listed stock has been up 870% over the past 12 months. 

Hut 8 Mining (NASDAQ: HUT): The Canadian company’s Alberta operations mined BTC 264 in September, a 19% decrease compared to BTC 326 mined in August. Hut 8 claims to deposit 100% of self-mined BTC into its reserves as a part of its ‘Hodl’ strategy. At month-end, the company reported holding BTC 4,724 worth USD ~207M. By the end of Q4, Hut 8 committed to its shareholders that reserves would contain at least BTC 5k. The company’s 12-month price performance is 1072%.

Marathon Digital (NASDAQ: MARA): The Las Vegas-based firm reported mining BTC 340.6 during the month, representing a 27% decrease compared to August. Year-to-date, the company has mined 2,098.30 coins. At month-end, Marathon held BTC 7,035 coins worth USD ~308M, including a purchase of BTC 4,812.66 made in January. The company’s stock has been up 1519% over the past 12 months. 

Key Takeaways: Several BTC mining firms appear to have adopted a strategy of holding on to mined coins instead of selling, embracing a long position in the asset. Compared to BTC’s ~4x price appreciation over the past 12 months, BTC mining firms have benefited from being treated as a pure-play on the industry, exhibiting appreciation in excess of 10-15x. Over the past year, correlations between the prices of the above-described equities and BTC prices are estimated to be relatively low.

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