Two of the world’s biggest Bitcoin miners are short on cash, and they’re looking at stock sell-offs to make money in the event of a long bear market.
With the help of the U.S. Securities and Exchange Commission, both Hut 8 and Marathon Digital Holdings have applied to be able to trade their shares for cash.
A few days ago, both public companies said they wouldn’t give up any of their valuable Bitcoin. This move comes after that promise.
To be expected, the stock of both companies is very closely linked to Bitcoin. Their share prices are at about half their all-time highs, and Bitcoin is down about 30% from its November high.
A company called Hut 8 wants to sell $65 million worth of common shares. Marathon wants to sell shares, stock, warrants and units worth $750 million for that amount of money.
Marathon: “We can’t change the price of Bitcoin, but we can control how ready we are to take advantage of market opportunities when they come up”.
Marathon wants to get rid of its Bitcoin at some point in the future and get more money in return for the Bitcoin.
Bitcoin stocks have to hope that it gets better
Over the past year, the reserves of Bitcoin miners have grown a little, but that’s about to change.
Since mid-November, Bloomberg has said that a Glassnode metric for changes to Bitcoin miner balances had turned negative for the first time in more than a month.
There is a lot of pressure from shareholders on smaller mining companies, so many of them sell off tokens to keep their heads above water or buy new equipment.
If you’re not careful, this can be very difficult and risky, but you can do it. The price of the machines has gone up a lot. If you said you were going to raise your exahash to a certain level, it will cost you 20% to 30% more to get there, said B. Riley analyst Lucas Pipes to the press.
The big players in the market don’t care about this at all if Bitcoin recovers before they lose money.
As a result, companies like Hut 8 and Marathon Digital Holdings can be a little more picky about where they get their extra money. Instead, they can just sell off their stock.
Marathon started keeping Bitcoin in October 2020, and since then, “We haven’t sold a single satoshi,” a company spokesperson is said to have said, per a report.
Sue Ennis, the head of Hut 8’s investor relations, agreed with this:
“We are believers in Bitcoin. Some miners sell Bitcoin or use it to pay expenses. We hold ours.”
Disclaimer: These are the writer’s opinions and should not be considered investment advice. Readers should do their own research.
