Author: Joey Wu, Wu said
This article will analyze and compare the profitability, hashrate, power, and number of mining machines of Bitdeer, Marathon Digital Holdings, and Riot Blockchain to present their competitive positions in the market.
Profitability
Bitdeer achieved a net profit of $113.8 million in the six months ended June 30, 2021, and a net profit of $82.6 million in the year ended December 31, 2021. However, in the six months ended June 30, 2022, the company incurred a net loss of $25.2 million, and a full-year loss of $60.4 million (mainly due to pre-IPO option fees, etc.). Among them, the revenue ratios as of December 31, 2022 were: 18.7% from self-owned mining, 36.4% from cloud computing power, 3.8% from cloud hosting, 29.8% from general hosting, 7.8% from member hosting, and 0.2% from mining machine sales.
In contrast, Marathon had a net loss of $37.1 million in 2021 and a net loss of 686.7 million yuan in 2022. Among them, the impairment related to mining equipment and supplier prepayments was $332.9 million, and the book value of digital assets decreased by $317.6 million.
Riot's net loss in the same year was 509.6 million yuan, a significant increase from the net loss of 15.4 million US dollars in 2021. Among them, Bitcoin mining revenue was 156.9 million US dollars, down from 184.4 million US dollars in 2021; data center hosting revenue was 36.9 million US dollars, up from 24.5 million US dollars in 2021. The loss was mainly reflected in impairment, including 335.6 million US dollars of goodwill impairment and 55.5 million US dollars of mining machine impairment, which had a significant impact on the reported net loss.
Hashrate
Riot has the highest self-operated computing capacity of the three companies, with computing capacity increasing by 213% in 2022 to 9.7 EH/s, a significant increase from 3.1 EH/s in 2021, accounting for approximately 4.2% of the total computing power of the Bitcoin network. In addition, due to delays caused by severe winter snowstorms in Texas, Riot expects to reach its self-operated mining computing capacity target of 12.5 EH/s in the second half of 2023.
As for Bitdeer, as of June 30, 2022, the computing capacity of its self-operated business was 4.2 EH/s, plus the 6.3 EH/s of managed computing power generated by the mining machines hosted in its mining data center, with a total managed computing power of 10.5 EH/s. As of December 31, 2022, the company's total computing power increased to 14 EH/s, accounting for approximately 6.1% of the total computing power of the Bitcoin network.
On the other hand, Marathon has 7.0 EH/s of self-operated computing power and 9.1 EH/s of total managed computing power in 2022.
power
In terms of total power, Bitdeer leads. As of June 30, 2022, the company's power capacity was 522 MW, increasing to 775 MW by the end of 2022. Bitdeer has successfully reduced the average power cost of its mining data centers to $40/MWh in 2021, which is lower than the estimated global average of $49/MWh. Currently, Bitdeer has five self-owned mining data centers and plans to expand to six worldwide.
Riot has an advantage in production efficiency because the company received $27.3 million in electricity subsidies in 2022, equivalent to approximately 1,815 bitcoins. Riot's cost of mining Bitcoin is $11,225 per bitcoin, down 6% from $11,939 in 2021. Riot terminated its hosting agreement at Coinmint LLC's Massena NY facility and moved all mining machines to its Rockdale facility, reducing electricity costs and eliminating third-party hosting fees. From the known data, Riot's electricity bill accounts for the lowest proportion, which means the highest production efficiency.
There is a lack of comprehensive information on Marathon's power usage.
Bitcoin production
Riot has seen the most significant growth among the three companies in terms of Bitcoin production, with the company producing 5,554 Bitcoins in 2022, a 46% increase from 2021's 3,812 Bitcoins.
Marathon produced 4,144 bitcoins in fiscal year 2022, a 30% increase from the previous year. Among them, 1,562 bitcoins were produced in the fourth quarter of 2022, an average of 17 bitcoins per day, an increase of 42% from the fourth quarter of 2021.
Bitdeer did not disclose its annual Bitcoin production. Its financial report showed that its Bitcoin mining revenue for the whole year of 2021 was US$185 million and for the first half of 2022 it was US$39 million.
in conclusion
In summary, the three companies are ranked by total computing power as Riot, Bitdeer and Marathon. However, Riot and Marathon are much higher than Bitdeer in terms of self-operated computing power. The higher the proportion of self-operated computing power, the greater the impact of Bitcoin prices on net profit, which is why these two companies suffered huge losses in 2022.
Bitdeer has a higher proportion of hosting business, so the risk is lower and its net profit is less affected by price fluctuations. In addition, Bitdeer also has an advantage in controlling electricity costs, so its financial situation is significantly better than the other two. As of 2022, the company has $321.8 million in working capital, of which $231.4 million is cash and cash equivalents.
It is worth mentioning that the three companies' self-operated mining revenue in 2021 was about 200 million US dollars, but after entering 2022, Riot and Marathon's self-operated ratio remained roughly unchanged, while Bitdeer's dropped sharply to 60 million US dollars. It can be seen that Bitdeer massively reduced its self-operated mining business before the bear market began, showing that the team of senior miners from the original Bitmain has rich experience in the cycle transition of the crypto market. But on the other hand, the current market value of Bitdeer is only about 1/3 of the above two North American listed giants. The reason is puzzling to the outside world, and it also shows that the US capital market seems to have temporarily not paid for Bitdeer for various reasons.