Miners in Bitcoin market ‘unaffected by volatility’


Despite steadily falling bitcoin prices and turmoil in today’s markets, some of the biggest miners are unfazed, insisting their operations will not be affected by negative price volatility.

Some even see it as an opportunity to gain market share when smaller competitors collapse.

Bitcoin (BTC) prices have been falling steadily throughout the year until the last 24 hours, when the plunge accelerated and hit its lowest level since December 2020. However, the miners were not deterred by this enormous pressure. Some may even have more mining zeal if Bitcoin’s downtrend continues into 2022.

Each of three different miners — two large public companies and one private miner — that Cointelegraph reached out to share cool feelings about the prospect of a bear market. They believe this will have little to no impact on their business plans.

Bitcoin miner Marathon Digital Holdings (MARA) said its “asset-light strategy” will shield it from almost any bear market impact. VP of Corporate Communications, Charlie Schumacher, told Cointelegraph that it maintained a cost base of about $6,200 per BTC mined in the first quarter by “outsourcing the muscle of our operations and keeping the intellectual power within the company.”

Marathon is the third largest holder of Bitcoin (BTC) among public companies, according to BitcoinTreasuries. It has the capacity to generate 3.9 exahashes (EH/s) hash power. MARA is down 15.42% and is trading at $9.97 in after-hours trading. It is down 92.6% from its December 2014 peak of $134.72.

Schumacher added that the exit of other miners due to capital shortages during bear markets creates an opportunity for larger operations like Marathon, which can benefit from reduced mining difficulties through a drop in hash power and competition on the Bitcoin network.

“When the hash rate goes down, there is a downward adjustment in difficulty, which lowers the energy expenditure on miners who keep hashing. Therefore, those who stand can benefit by potentially earning more bitcoin.”

Cointelegraph also received replies from Jason Les, CEO of Riot Blockchain (RIOT), another major mining company. It currently holds the eighth most BTC among listed companies, according to Bitcoin Treasuries. It controls 3.9 EH/s hash power as of March 4, but did not disclose its cost per coin mined.

RIOT is down 9.16% and is trading at $6.83 in after-hours trading. It is down 90.5% from its February 2021 peak of $71.33.

Les also expressed composure regarding the current and future volatility of the bitcoin market. Like Marathon and Redivider, Les pointed to his company’s “strong balance sheet with no long-term debt” as key strengths it can rely on from a business perspective. He added, “Changes in bitcoin market conditions do not impact our miner schedules, so we continue to increase our hash rate on a monthly basis.”

“Riot’s mining schedules will not be impacted by bitcoin volatility, we are focused on building a sustainable business operating under bitcoin market conditions.”

Redivider CEO Tom Frazier also says he is unfazed by the prospect of another prolonged downturn. Redivider is a privately held data center provider for bitcoin mining operations, specializing in opportunity zones designed to benefit workers in disadvantaged regions of the United States

The core of Redivider’s 1.5-year-old business is managing data centers whose Bitcoin hash power can be rented by mining companies for a fee. Frazier told Cointelegraph in a call May 11 that if its data centers don’t have tenants at a given point in time, Redivider can always maintain a revenue stream for all of its facilities by taking hash power and blocking the rewards for itself .

He didn’t disclose what Redivider’s base price was per bitcoin mined or the size of its operation, but he assured that “our BTC production price will not be impacted.”

Frazier said that downturns in the bitcoin market “have little impact on what we do because of our 10-year plan.”

“Corrections are taking place in the market because BTC is highly volatile, consistent with any other volatile asset class. This volatility will not affect our strategy. These moments offer opportunities.”

Related: Bitcoin is struggling to hold $29,000 as fears of regulation and Terra’s UST implosion have hit crypto hard

Considering the current turmoil in the crypto markets following the collapse of the Terra (LUNA) project and Bitcoin currently trading at $28,931, its lowest since January 1, 2021, according to CoinGecko data, it might quickly become clear whether miners can jump at the opportunity on their doorstep, they claim.