2024 started with a sharp rise in the price of Bitcoin, but it has not been a kind year for the miners who run the cryptocurrency, with last month's “halving'' reducing the rewards given to the operating computers that process blockchain transactions. Ta.
Stronghold, a publicly traded New York-based mining company, said on its earnings call today that it is considering the possibility of selling all or part of the company to “maximize shareholder value.” According to a press release shared, the company plans to announce luck. The company's market capitalization is currently close to $40 million.
While many mining companies rely on existing grids to power computers that compete to process blocks of transactions and earn Bitcoin, Stronghold is an example of a system in which the state of Pennsylvania is paying companies to The company has pioneered a unique model of operating two facilities that burn waste, known as coal waste. “regain”. By generating its own electricity through this process, Stronghold effectively functions as its own power plant, calling itself “the only publicly available, vertically integrated mining company” with the goal of “regenerating and improving the environment.” It is explained that.
Despite the novel approach and the rise in Bitcoin prices after the approval of a Bitcoin ETF in January, the outlook for miners such as Stronghold has darkened since the April halving. Some analysts had predicted that listed companies would have an advantage given the increased operating costs of inefficient operations taken offline, but mining company stock prices have not followed Bitcoin's meteoric rise. There wasn't.
Stronghold stock, worth about $11.25 in late 2024, was trading at about $3 on Wednesday. In late December, SEC filings revealed that CEO Greg Beard, who owns 10% of the company, sold nearly 40,000 shares after buying about 1 million shares in the previous year. It turned out that it did.
Stronghold's press release didn't say whether the decision to sell was related to pricing related to the halving, but Beard told Kitco News in March that the event was “a sign that we're different.” “We're going to show you soon why it's important to own your power.”
“Our value proposition is that if power is expensive, we can shut down the Bitcoin mining data center immediately, as this is not an essential service,” he said.
Instead, the press release attributes the decision to “valuation misalignment” when comparing Stronghold's market value to the valuations of other public Bitcoin mining companies, commercial power companies, and data centers. . Beard said in a statement that the company could potentially expand its existing capabilities into either Bitcoin mining or advanced computing for AI, as other companies are exploring. A company spokesperson declined further comment.
