Largest Public Bitcoin Mining Companies

Bitcoin mining companies have seen their valuations plummet as the price of bitcoin (BTC) is in the midst of a bear market, squeezing the profit margins of its creators.

The performance of the exchange-traded fund (ETF) Valkyrie Bitcoin Miners (WGMI) shows the extent to which the value of the cryptomining business was affected. As of November 11, the fund was trading over 70% below its launch price in February 2022.

What are the biggest public bitcoin mining companies and how do they weather the storm? Here we take a look at the largest mining stocks by market value.

What is bitcoin mining?

Bitcoin mining involves solving mathematical puzzles to process the transactions of the bitcoin blockchain and earn rewards. By performing this task, new BTC tokens are created and miners are compensated for their efforts, equipment and electricity bills.

Some sophisticated hardware is required to mine bitcoin profitably as the difficulty of the puzzles increases to slow the rate at which the asset’s supply expands. The largest bitcoin mining companies own thousands of devices that solve the problems faster than a human can. The total value of the BTC tokens they receive in return is considered the company’s revenue.

The cost of running large bitcoin mining companies includes the electricity needed to power the units, maintenance of the mining farms’ expensive cooling systems, personnel, and other operating costs typical of any business.

In 2022, the bitcoin mining sector entered one of its worst bear markets since the digital asset emerged in 2009, as a worsening of macroeconomic conditions worldwide has pushed the value of BTC to its lowest level in 20 months, as of early November.

Meanwhile, industry-specific developments such as the collapse of the Terra ecosystem and the Celsius network, along with the FTX liquidity crisis, damaged the price of BTC, sending shockwaves through the cryptocurrency markets.

Largest public bitcoin mining companies

So what are the biggest public bitcoin mining companies? Below is the list of the largest miners by market capitalization according to CompaniesMarketCap data as of 11 November.

Marathon Digital Holdings (MARA)

Marathon Digital (MARA) is the first stock on the list of bitcoin mining companies. The firm is a former uranium and vanadium exploration business that turned to bitcoin mining after the firm merged with Global Bit Ventures back in 2017. By the end of 2021, the company reportedly accounted for 2.1% of the global bitcoin hash rate.

Marathon has facilities in South Dakota, Nebraska, Montana and Texas. The company aims to run its bitcoin mining facilities with renewable energy sources by the end of fiscal year 2022.

At the end of 2021, Marathon had reserves of 8,115 BTC, including 4,794 in an investment fund. These holdings were valued at approximately $346 million at the time, but are possibly worth much less now as the value of BTC has plummeted in 2022. During the same period, the firm generated total revenue of $150.46 million, but incurred a loss of $85.09. m.

In addition, Marathon had long-term debt of $728.40 million on total assets of $760.09 million, including $268.52 million in cash and equivalents. This appeared to be the most leveraged crypto mining company on the list.

Riot Blockchain (RIOT)

Riot Blockchain (RIOT) is another stock on the list of largest public bitcoin mining companies. The firm also offers its facilities to other large mining operations so that they can establish their own farms by taking advantage of the firm’s proprietary infrastructure.

Riot’s primary mining site is in Rockdale, Texas. The firm operated 30,907 mining rigs by the end of 2021, and had 4,884 BTC tokens in reserve valued at $159.54 million at the time.

At the end of this year, the company had $213.24 million in revenue, most of which came from its self-developed mining operation. It also posted a net loss of $7.93 million, had no long-term debt and boasted $312.32 million in cash and equivalents.

Canaan (CAN)

Canaan (CAN) is a Chinese company that has established a subsidiary in the Cayman Islands to be able to offer its ordinary shares to US-based investors via American Depositary Shares (ADS). The firm has been producing crypto mining rigs since 2013 for bitcoin mining companies under the Avalon brand.

So far, the company has developed nine mining rigs, including the first generation of the A1246 units, which were released in 2020. The miner also produces AI-powered applications.

At the end of 2021, Canaan had 346 employees, produced revenues of $1.42 billion – most of which came from the sale of its flagship mining rigs – and posted a net loss of $1.02 billion. The company also reported no long-term debt and had cash and equivalents of $421.23 million.

Hut 8 Mining (HUT)

Founded in 2017, Hut 8 (HUT) is one of North America’s oldest bitcoin mining companies. Headquartered in British Columbia, Canada, the company offers, apart from its main mining operations, processing services to institutions.

According to their website as of November 11, the firm had three digital asset data mining facilities, five multi-tier data centers for high-performance computing, more than 400 customers for its advanced computing solutions, and 7,078 BTC tokens in reserve as of May 31, 2022.

At the end of 2021, Hut 8 generated revenues of $173.77 million and net losses of $72.71 million. In addition, the firm had long-term debt of $24.2 million and cash and equivalents of $140.13 million.

Cipher Mining (CIFR)

Cipher (CIFR) is the last on our list of the top five bitcoin miners. Cipher is a rapidly growing industrial-scale company with operations in the United States. In February 2022, the firm started its first facility in the country and had plans to activate another two to four sites that could be fully powered by renewable energy.

Cipher is a pre-revenue company. For full 2021, the firm posted a net loss of $72.15 million, had no long-term debt and reported cash and equivalents of $209.84 million. The company went public in August 2021 via a merger with a special purpose acquisition company (SPAC) called Good Works.

In August 2021, it signed agreements with Bitmain Technologies and SuperAcme Technologies to acquire 27,000 and 60,000 miners respectively. Part of this equipment is to be up and running in 2022. However, the company’s latest quarterly reports do not currently show any income. Cipher’s mining operations will be based in Alborz, Texas, where the first facility has been built.

The bottom line

Note that the current list of the largest bitcoin miners may change as the prices of individual stocks fluctuate. Therefore, this data should not be used as a substitute for your own research. Always do your own due diligence, study the company’s fundamentals and technical details in detail, look at the latest news and a wide range of analyst commentary.

Remember that past performance does not guarantee future returns. And never trade money you can’t afford to lose.

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