Marathon Digital, the largest public Bitcoin miner by realized hash rate, has made a significant investment in Bitcoin after raising $300 million from a convertible senior notes offering. The company announced on August 14 that it had purchased $249 million worth of Bitcoin, acquiring 4,144 BTC at an average price of $59,500.
The funds for this purchase were raised through a private offering of 2.125% senior notes maturing in 2031, which were oversubscribed to qualified institutional buyers. After deducting discounts and commissions, Marathon had $292.5 million to work with, using the majority of it to bolster its strategic Bitcoin reserve.
This latest acquisition brings Marathon’s total Bitcoin holdings to over 25,000 coins, with a market value of $1.46 billion. In July, the company had already bought $100 million worth of BTC and announced its intention to retain all mined Bitcoin moving forward.
Despite the positive news of the Bitcoin purchase, Marathon Digital’s stock price fell by 2.26% on August 14, closing at $15.14. The company’s second-quarter revenues also fell short of expectations, reaching $145 million compared to the $165.2 million generated in the previous quarter. This decrease in revenue may be attributed to the rising costs of Bitcoin mining, which doubled even as Marathon increased its hash rate.
However, there was still a 78% year-on-year growth in revenue, with the company making $81.8 million in the second quarter of 2023. Marathon Digital also expanded its operations by adding 25,000 new Bitcoin mining rigs, bringing the total to approximately 250,000 machines. This expansion boosted the company’s hash rate to 24.7 EH/s, surpassing some of its key competitors like Riot and Core Scientific.
Marathon Digital plans to use the remaining $43 million from the convertible notes offering for additional Bitcoin purchases and general corporate purposes, including debt repayments and strategic expansions. Despite the challenges faced in the second quarter, the company remains optimistic about its future in the Bitcoin mining industry.