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Sizing Up 12 Bitcoin Mining Stocks


  • Bitcoin mining stocks have been big winners over the past year benefiting from the bull market in cryptocurrencies.
  • The industry is quickly evolving with a profitable business model at current bitcoin prices.
  • The 12 bitcoin mining stocks we're trading and where we see the value.
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Programmer preparing mining rig with GPU
Photo by eclipse_images/E+ via Getty Images

Bitcoin mining has emerged as a vibrant new industry with several stocks in the segment benefiting from climbing cryptocurrency prices. The price of bitcoin (BTC-USD) near $60k is up over 100% just year-to-date with several

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This article was written by

Dan Victor, CFA profile picture

Dan Victor, CFA is a market professional with more than 15 years of investment management experience across major financial institutions in research, strategy, and trading roles.

Dan leads the investing group Conviction Dossier, where his focus is on helping investors stay ahead of market trends and inflection points. Dan’s investing vehicles of choice are growth stocks, tactical exchange-traded funds, and option spreads. He shares model portfolios and research to help investors make better decisions, via his Investing Group’s active chat room.

Analyst’s Disclosure: I am/we are long BTBT, HSSHF, BFARF. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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Comments (144)

12 Aug. 2021
Thanks for the article. Would love to see an update on this. And if it could include an analysis on each company's energy cost that would be great!
arthurdave profile picture
Iris Energy coming to market this year
Operating 112 PH/s, CY21: 700 PH/s (funded), CY22: 2,292 PH/s planned

bazooooka profile picture
These guys maybe worth for the list too www.marketwatch.com/...
Any thoughts as to why BFARF has dropped recently?
@gc03 Every miner has dropped for the last 3 days. DOGE is making things crazy right now.
Shamanski profile picture
With CLSK announcement of even more BTC mining capacity, they are clearly the best BTC play right now. IMO
Look at the market cap of CLSK vs their projected BTC Revs.
@BOOX Research: You have also written an article on a crypto NON-miner (Galaxy Digital), recently. If one is to own a basket of crypto stocks, what percentage do you believe should be in miners as opposed to non-miners?
Dan Victor, CFA profile picture
@denoverenes7 a "crypto exposure" basket is a good topic i may explore in a future article.. Galaxy Digital needs to be towards the top, I don't have a weighting in mind right now but just based on its market cap and "diversified exposure" is definitely one of the most important companies in the sector.

caveat is that the current stock price for Galaxy looks like it has run a bit hot, up nearly 100% in just a few weeks so im consider it more of a "hold" at this point, not chasing it right now. Similar story with CoinBase IPO, it needs to be at the top of a crypto basket but near-term valuation is a concern -for me.. best bet is to just pick your spots
@BOOX Research That's excellent advice. An alternative to COIN might be Voyager Digital (VYGVF). That's one I have been in for awhile.
Jion profile picture
Two others to watch is the tiny Chinese KBSF and the recently IPOed BAOS. KBSF has some related news lately. BAOS is a already profitable company which received an investment from EBON for crypto expand.
@Jion Is that NASDAQ:KBSF?
Jion profile picture
@P. Forts correct.
are you sure of ncty market cap ?
Kingdom Capital profile picture

Puts them on target to be in the "1x run rate P/S" group
Dan Victor, CFA profile picture
@Kingdom Capital i like it.. MKTY is good. I just avoided including some of the smallest miners by market cap in the discussion.. there are probably about 5-10 more "nano-caps" in the space and if BTC is going higher than they all have big upside
Kingdom Capital profile picture
@BOOX Research makes sense. I really like the Brookstone presence here. Few of these names have a reputation behind them like that, especially the smaller ones.
@BOOX Research I fear for the nano-cap miners. With the upgrade cycle in the rigs and extreme difficulty in accessing new miners in teh current environment I think they could get squeezed out as the hash-rate increases over time unless they have some preferred relationship with the manufacturers and cheap access to capital.
Thanks for a great summary of the Bitcoin miners.
Dan Victor, CFA profile picture
@Clark158f1 thanks for comment. good luck!
10 Apr. 2021
Being somewhat new to this asset, would someone explain why many of the miners had a major run-up and fall earlier this year?
@rflyg most growth names did, it ran up after bitcoin price ran up to ATH, but then pulled back with most growth / tech stocks
Baron_Samedi profile picture
@rflyg my guess would be, like the article says, some of the mining stocks run with btc based on the announcements they've made about their potential profitability from mining and the amount of btc the have on their balance sheet. The market prices them based the spot price of BTC. MARA for example has huge swings more than RIOT and coincidentally has more btc on their balance sheet
SlowHandLuke profile picture
Thanks for a very interesting article. On a slightly different, but related, note, I read an analysis of BTC price movements somewhere (sorry, I can't find it now) that correlated the big price increases with the Halving schedule, and the big price drops with miners selling BTC to cover energy costs.

The jist was that the miners have covered their costs, and are done selling for the year. That will (theoretically) remove a lot of downward pressure on the price for the rest of 2021. BTW the next halving is estimated to be around 2023-10-20, but is not set.

I'm interested to hear others thoughts on this theory on price movements.
@SlowHandLuke i think that everything has changed with institutional investors jumping in and buying up, from what i read there is less circulating, which all should keep the price up where as most cycles it would fall after its run up, also most people expect the run up to continue up past 100-150K for this bull run alone
Baron_Samedi profile picture
@SlowHandLuke I read that too. Re: halving I thought it was every 4 years?
SlowHandLuke profile picture
@Baron_Samedi The Halving Date is a moving target. I think it is based on Average Block Generation Time. I used this site to find the halving date, which has already changed: www.bitcoinsensus.com/...
11146471 profile picture
@BOOX Research you forgot to mention the new elephant in town...Cipher mining currently trading as $GWAC

It dwarfs all companies in your analysis with 500M dollars ready to be deployed into BTC mining. They project 9% of global mining capacity by 2025.
@11146471 From Bus. Wire: >>> Bitfury Group has ....mined more than 600 thousand Bitcoin.<<

What, where, when and how?!
Nice summary. Thanks for the analysis. Would love to see your personal “rankings.” I have stakes in most of these miners. Your summary gives me assurance moving forward. Here’s to hope.

Thank you.
Post Hoc Analytics profile picture
Very informative article. Great job on the tables and charts, I have some minor nitpicks with a handful of your data points but that's to be expected in an industry this dynamic.

The one thing I'll take issue with is a lack of detail on increasing network difficulty. i wrote a recent piece on MARA where my revenue projections assumed that total network hash rate (and corresponding difficulty) will double by year end. I'm now fearing that that estimate may have been too conservative. Everyone, including me, has at one time or another said "at current prices and network difficulty." Once you start modeling different BTC prices and varying difficulty increases your data set starts to approach infinity, so some simplification is required particularly for those of us relying on excel. :)

I anticipate some vocal disagreements about the magnitude of network difficulty increases but think its time that we, as a community, at least started talking about them.

Again, nice work and great article.
Excellent article thank you. When looking at future sales multiples I would welcome views on correlation of network hash rate to BTC price, eg what would network hash rate be at end of 2021 assuming BTC at $100k.
Dan Victor, CFA profile picture
@Pastyandsauce the correlations are complex but i'd argue that the market price is less relevant.. even if it was confirmed 100% BTC will be trading at $100k by year-end, it wouldn't necessarily accelerate the hash rate growth because the bottleneck is shortages of mining equipment.. no one is holding back capacity or production right now.

just ballpark guesstimate, id say the year-end hash rate might be around 200 million TH/s (about 25% higher) so indeed you can adjust those revenue projections lower- but at the same time its likely the miners will continue to announce more capacity increases/ new purchases.

another point that I believe people underestimate is that some of the oldest equipment online right now becomes obsolete and no longer make sense to run because they are not efficient enough..so it balances out the increase of new machines entering
@BOOX Research many thanks, what is your view over the next 3 years re network hash rate? Totally appreciate that this will be a "wild" ballpark estimate.
Post Hoc Analytics profile picture
@Pastyandsauce I concur with @BOOX Research that market price will have close to zero correlation to BTC price.

Just look at 2018: BTC declined from $14k to $38k and total hash rate TRIPLED.

Every next gen rig that gets delivered this year WILL be plugged into the network so long as revenue exceeds cost of production, which is, I believe, under $5k for some of the more efficient players.
Just curious. How are people going to identify "clean" coins (ie made with renewable energy) vs "dirty" (ie made with coal or oil or whatever) coins?

I don't own any of these nor any coins and don't really understand any of this. But I've read that HVBTF only uses renewable energy but I have no idea how important that might become (or even if its true).
Dan Victor, CFA profile picture
@davidbdc there are developments of "clean" mining pools where all the capacity and transactions will be controlled to ensure the energy is from renewable sources.. DMG/ARGO and Marathon are all involved in the new "Terra Pool" www.coindesk.com/...

another way it could work is that a miner like HIVE simply sells its production off-exchange with buyers potentially willing to pay a premium for "clean coins".
Sparkle0135 profile picture
@davidbdc from what I read if I correctly understand it, is that every coin and its transactions have a complete history declared and transparent on line from inception.
@BOOX Research Thank you for the reply. Since I haven't done anything stupid for a while, I'm going to buy some DMG. Ha!
Sparkle0135 profile picture
Do you know of an ETF for existing and up and coming bitcoin miners ?
Sparkle0135 profile picture
@beauble thanks.
Thanks for the great article!
09 Apr. 2021
Can you please fix one of your excel tables.

DMG partnered with Argo blockchain for the green mining pool (tera pool)
Dan Victor, CFA profile picture
@Toffif the note on the table refers to a separate agreement with MARA but youre right that ARGO is a big player in the move towards "clean energy pools" www.globenewswire.com/...
Dividend Herder profile picture
@Toffif They also partnered with Marathon: www.globenewswire.com/...
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