It seems Bitcoin BTC/USD miners have found their muse—and it’s none other than MicroStrategy Inc MSTR.
JPMorgan’s Nikolaos Panigirtzoglou reveals that miners are mimicking the tech company’s aggressive bitcoin accumulation strategy as they navigate a landscape of dwindling mining rewards and rising competition.
The result? A shift in how these digital prospectors approach profitability.
MicroStrategy, led by Bitcoin evangelist Michael Saylor, helped start the corporate trend of turning cash flow and leverage into a Bitcoin treasure trove. Now, miners like MARA Holdings Inc MARA are joining the game with their own twist: a ‘BTC Yield’ strategy designed to grow their bitcoin holdings per share.
The ‘BTC Yield’ Strategy
The economics of mining have grown increasingly brutal. Post-halving, reduced block rewards and a surging network hashrate have squeezed miner revenues per terahash, leaving less breathing room for profitability.
JPMorgan points out that daily revenues per terahash are at historical lows, forcing miners to rethink their playbooks.
To stay afloat — and relevant — miners like MARA are doubling down on Bitcoin.
The strategy involves issuing debt or equity to not only hoard mined bitcoin but also actively purchase more. In MARA’s case, 60% of its Bitcoin acquisitions this year came from direct purchases, with the remaining 40% from expanded mining operations.
The payoff? Marathon now boasts a stash of nearly 35,000 bitcoins, trailing only MicroStrategy among publicly listed companies.
The ETF Effect
Adding complexity to the equation is the U.S. debut of spot bitcoin ETFs, which provide institutional investors with a more direct path to bitcoin exposure. Shares of bitcoin miners, once a proxy for institutional bets on the leading crypto, have underperformed in light of this new competition.
Yet, miners like MARA are finding ways to thrive in this shifting landscape. By embracing BTC Yield strategies and leveraging low-interest convertible notes to fund their bitcoin spree, they are cementing their role as major players in the broader Bitcoin ecosystem.
Mining Or Stacking?
The lines between mining and investing are blurring, with miners increasingly resembling bitcoin-focused asset managers. If this trend continues, we could see more miners pivot toward holding and acquiring bitcoin rather than relying solely on mining operations.
As Bitcoin’s ecosystem matures, one thing is clear: the playbook is being rewritten, and it has Saylor’s fingerprints all over it.
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