John Miller

Was the argument that Andres did not want to do HPC/AI and/or focus more on energy business?

Would love to hear your views on HIVE's valuation, the Paraguay expansion, or their HPC/AI buildout? Thanks for reading. -J

I like the attractive revenue and earnings multiples. J

@addedupon it’s not really on chain but BITO is not bad.

@Mike Fay because Hut and Hive were declaring and/or taking thier Ethereum mining in BTC you can really see how they are struggling post merge in your graphic above.

@hawkeyec Ethereum also has consumptive value as payment for using the EVM. And anyway, you are lucky compared to many others across geographies and time in that your KC strip only increased 12% in your favored currency last year.

@Xxfactor DCG and other institutions are short capital so it makes sense that there would be some selling if offered a fair price. On taxes I don’t know, there are probably plenty of losses to offset any gains.

@gwat1979 ..they are selling ETHE shares not the underlying Ethereum coins.

For the coins to come out of custody there would need to be redemptions where the coins are given to the share holder. This requires SEC sanction and a holder vote… basically. This is under consideration if the ETF lawsuit(s) fail. Redemptions would allow the discount to NAV to close through arbitrage.

Coins are safe at Coinbase. Long holders likely see NAV close through ETF or redemption plan. Short term discount can widen if DCG unloads their own shares into the market. Bitcoin price can also revisit 16k as discussed above.

@Murad Shawar …ten more than MARA at a third the market cap and stronger balance sheet. In the short term the market is a voting machine but in the long run a weighing machine.

@prema_donna Mostly agree.

Note that when you are talking bout BNB you probably meant BUSD (a US issued and regulated token). BNB is not backed. AND BUSD is *basically* fully backed with high quality, near dollar assets.

Binance has been very transparent relative to Coinbase in giving actual addresses of reserves. Also I think the Bitcoin you are attributing to Coinbase includes the Grayscale custody assets.... which are not owned by Coinbase in any way or in any way backing its trading customers.

Biannce lists its BNB assets but does not include them as a trading system reserve (like FTX did with FTT). BNB also has a much larger use case than FTT and also has a completely different and better issuance structure and float.

CZ has spread FUD about Coinbase. That sucks. But maybe CZ is not quite the crook you make him out to be. While he did tank the FTT token (and lose a lot of money himself) SBF was likely selling him out in Washington in the months prior and he knew it.

If you have a moment please take a look at my November 22 article... FTX Lessons: Trustless Crypto, Pointless Tokens And Binance's Balance Sheet
seekingalpha.com/...

nansen.ai thinks FTX.us moved funds to FTX international just prior to the bankruptcy filling.

@Davsha pretty good upgrade timing as now up 17% with the broader market flat over the month.

DCG out with a long letter yesterday. Read QandA #14

https://dcgupdate.com

Nice article Mike. It is hard to figure out, lots of moving parts with each firm’s energy situation and fleet type. But my feeling is that we are all a bit over focused on the stacks and not looking at the debt enough.

Think I like Bitfarms first (though Argentina delays hurting), CleanSpark second… low debt, actually mines, Georgia nuclear.

Passing on MARA for the debt, and energy unknowns, will have the most XPs and take share post halving if they can get there and get organized.

Passing on Riot on production costs (might revisit).

Passing on Hut, love the stack and low debt, costs spiking, hate the energy situation being limited and being gas and the lack of focus on mining.

Hive is different company post The Merge.

It’s really a hodgepodge of situations. Mara will have the best fleet but less control of energy and relatively large debt. Hut has low debt, mostly MicroBT equipment, and some energy issues and reliance on gas. CleanSpark has low ratio of XPs. Bitfarms has Micro BT and a few problems in Argentina. RIOT has a costs problem. Hive has uncertainty from Ethereum staking. Core has balance sheet issue that looks to favor the debt holders over the share holders.

@gree3616 SEC will definitely use LBRY in the XRP case. But useful to note it is one judge in one small circuit against a poor defendant. While SEC got summary judgement for penalty and disgorgement the injunction has some unknowns. Also note there are differences to Howey across courts.

@williamz tried hard to make it interesting and dense.

@Investment Pancake ... "basically" that is not what they are saying. They have Coinbase custody which is third party audited. Coinbase and Armstrong could possibly be running some kind of intricate con on them with Deloitte I suppose.

But you are basically paying the percent to get Armstrong's service becasue it is so much easier and better than holding your own keys. Revealing the addresses does give some insight into ways and means that Coinbase wants to keep secret. But my guess is they may update their thinking on this if enough people really have a problem.

They create the wallets in a Faraday cages at undisclosed locations at undisclosed times possibly with multi sig.

@nikit2h ....you may be missing our point that the fee is not really driving GBTC to zero.

@Chandu123 Binance is not using BNB for collateral so probably not.

@Micskill01 ...on September 30th Coinbase had about $630 million of its own basically evenly divided between Bitcoin Ethereum and altcoins (page 20 of their Q3 letter to share holders link below). They had about $5 billion in their own cash (page 10 has a break down of how they are holding this.) They have about $3.4 billion in long term debt due 2026-2032 give or take. It is a fortress balance sheet. Plus it is almost certain they are holding 1:1 on the customer assets unlike FTX international.

s27.q4cdn.com/...

@Kris Daubs great comment. Especially for your first!

Ok here is an alternative, it’s like Sewards Folly.