TLDR
Marathon Digital increased November Bitcoin production by 26% to 907 BTC
Company’s hash rate grew 15% to 46.1 EH/s in November
Upsized convertible note offering from $700M to $850M for Bitcoin purchases
Holds 34,959 BTC valued at $3.3B, second only to MicroStrategy
Plans to use most proceeds for Bitcoin acquisition and corporate activities
Marathon Digital Holdings has strengthened its position in the cryptocurrency market through a combination of increased mining operations and strategic Bitcoin purchases. The company reported record-breaking performance in November 2023, marking substantial growth in both its mining capabilities and Bitcoin reserves.
In November, Marathon’s Bitcoin production reached 907 BTC, representing a 26% increase from the previous month. The company’s mining operations showed improved efficiency, with its energized hash rate climbing to 46.1 EH/s, a 15% boost from October levels. This enhancement in mining capacity led to the company mining 254 blocks in November, the highest monthly total in its history.
The company’s CEO, Fred Thiel, attributes these improvements to successful deployment of new mining equipment and enhanced operational efficiency. These developments have helped solidify Marathon’s position as a leading player in the Bitcoin mining industry.
Beyond its mining achievements, Marathon has pursued an aggressive acquisition strategy. The company recently announced plans to raise funds through convertible senior notes, initially setting the target at $700 million. This target was later increased to $850 million, demonstrating strong investor interest in the offering.
These notes, set to mature in 2031, come with unique terms. They will not require regular interest payments and can be converted into cash, MARA stock, or a combination of both, providing flexibility for both the company and investors.
From the proceeds of this offering, Marathon expects to generate approximately $835 million in net proceeds. This amount could potentially reach $982 million if additional notes are fully purchased. The company has allocated $48 million to repurchase existing convertible notes due in 2026, worth about $51 million.
MARA Holdings, Inc. Announces Pricing of Oversubscribed and Upsized Offering of Zero-Coupon Convertible Senior Notes due 2031https://t.co/3PYqjzn2A7
— MARA (@MARAHoldings) December 3, 2024
The majority of the remaining funds will be directed toward acquiring more Bitcoin, with some portion reserved for general corporate activities and potential strategic acquisitions. This follows Marathon’s earlier fundraising of $1 billion through a similar offering in mid-November, which enabled the purchase of 6,474 BTC, valued at approximately $615 million.
Marathon’s approach combines active mining operations with strategic Bitcoin purchases, allowing the company to take advantage of market conditions. When Bitcoin prices decline, the company can acquire more coins directly, while its mining operations continue to generate new Bitcoin at costs below market prices.
As of November 30, 2023, Marathon had acquired 12,965 BTC during the year at an average price of $77,692. The company’s mining operations have produced an additional 8,563 BTC, resulting in a year-to-date Bitcoin yield per share of 37.2%.
The company’s total Bitcoin holdings now stand at 34,959 BTC, with a market value of approximately $3.3 billion. This positions Marathon as the second-largest public holder of Bitcoin, trailing only MicroStrategy.
In November alone, Marathon added 703 Bitcoin to its holdings, demonstrating consistent growth in its reserves. The company has also set aside $160 million specifically for purchasing Bitcoin during price dips, showing its commitment to accumulating more of the cryptocurrency.
The recent upsize in the convertible note offering from $700 million to $850 million indicates strong market interest in Marathon’s strategy. The zero-interest nature of these notes provides Marathon with favorable terms for funding its expansion.
Marathon’s mining performance has shown steady improvement throughout the year. The increase in hash rate and block production suggests the company’s operational investments are yielding results.
The combination of improved mining efficiency and strategic Bitcoin purchases has strengthened Marathon’s market position. With its dual approach to acquiring Bitcoin, the company continues to expand its holdings through both mining and direct purchases.
These recent developments have reinforced Marathon’s status as a major player in the Bitcoin mining industry, with its holdings second only to MicroStrategy among public companies.
