Cryptocurrency miners' performance metrics improved in March as the number of Bitcoins (BTC-USD) mined grew 18.3% on average and the hash rate rose by 6.5% in a backdrop of record high network difficulty, according to the table below.
Keep in mind that the Bitcoin (BTC-USD) network's high difficulty implies that it will take more computing power to mine the same number of blocks, making the network more secure against potential attacks. When the difficulty algorithm is high, it typically means that there's an influx of miners. Unsurprisingly, the total hash rate, or the amount of computer power being used by the network to process transactions, is also trending near all-time highs, indicating that the Proof-of-Work-based BTC network is becoming more secure and immune to attacks as more miners verify transactions.
Looking at the crypto miners individually, Marathon Digital's (NASDAQ:MARA) bitcoin production and hash rate both increased over the prior month, though B. Riley lowered MARA's price target to $57 per share as its results came in lower than expected due to delays in miner deployment caused by an extended approval process for becoming connected to the grid. Still, the B. Riley's PT implies nearly 140% upside from Friday's close. Recall MARA CEO Fred Thiel said Monday that his company is open to being acquired, but "it's got to be the right price."
Mining to expand outside U.S.:
While a large chunk of Bitcoin (BTC-USD) mining occurs in the U.S., some miners are looking to expand globally, and in particular Scandinavia and the Middle East. “We are geographically diversified in the U.S. … but we are also looking outside the U.S.,” Core Scientific (NASDAQ:CORZ) Chief Executive Mike Levitt said at the Bitcoin 2022 Conference in Miami Thursday, as reported by Bloomberg, adding that some nations have suitable power sources. Also, “the Middle East is a very interesting place because they have asymmetry in power and energy,” Marathon's Thiel said at the conference. “In the UAE in the summertime, they generate four gigawatts of power to run their air conditioners, the other nine months of the year they only use one gigawatt and three gigawatts sitting idle,” he added.
For some context, China's majority share of the crypto mining market last year dropped quickly after the People's Bank of China declared digital asset transactions illegal, which included halting investment in crypto mining projects. The move led miners to search for alternative regions with fewer policy risks as well as low electricity costs like Texas. While the regulatory landscape for the decentralized space remains uncertain, some policymakers appear to be making headway, as U.S. Treasury Secretary Janet Yellen called for crypto regulation to mitigate fraud and risks in her first major speech on digital assets.
For the month, some of the biggest cryptocurrencies by market cap turned in decent gains in value. Bitcoin (BTC-USD) +2.4% posted modest gains in March and was outpaced by its peers, including Ethereum (ETH-USD) +10.3%, Cardano (ADA-USD) +18%, Solana (SOL-USD) +24%, Binance Coin (BNB-USD) +4.8% and XRP (XRP-USD) +3.8% as seen in the chart here.
Considering miners' relatively robust performance metrics in March, along with softer bitcoin (BTC-USD) price gains and an elevated total hash rate, it looks like miners are primed for a somewhat solid first quarter. SA contributor Bitfreedom Research at the end of March provided its "bullish case for bitcoin mining," citing MARA and RIOT as the biggest movers in terms of hash rate expansion.
|Company||Ticker||Type||March||February||M/M % Change|
|Marathon Digital||(MARA)||bitcoins mined||436.1||360.3||21.0%|
|hash rate (EH/s)||4||3.8||5.3%|
|hash rate (EH/Ss)||2.7||2.3||17.4%|
|HIVE Blockchain||(HIVE)||bitcoins mined||278.6||244.4||14.0%|
|hash rate (EH/s)||2||1.9||5.3%|
|Riot Blockchain||(NASDAQ:RIOT)||bitcoins mined||511||436||17.2%|
|hash rate (EH/s)||4.3||3.9||10.3%|
|hash rate (EH/s)||2.3||2.2||4.5%|
|Hut 8 Mining||(HUT)||bitcoins mined||345||298||15.8%|
|hash rate (EH/s)||2.54||2.5||1.6%|
|Core Scientific||(CORZ)||bitcoins mined||1143||981||16.5%|
|hash rate (EH/s)||8.3||8.2||1.2%|
|Argo Blockchain||(ARBK)||bitcoins mined||163||135||20.7%|
On Thursday, ARK Invest CEO Cathie Wood touted Bitcoin as a "great hedge against inflation" and reiterated her $1M price target.