Crypto mining operations based in the United States are committed to increasing their hash power with more hardware despite Bitcoinโs (BTC) three-month downturn.
The Marathon Digital Holdings and GEM Mining companies in the U.S. told Cointelegraph this week that they each expect the size of their respective operations to grow through 2022 by at least doubling the number of machines at their facilities.
Marathon Digitalโs VP of corporate communications Charlie Schumacher told Cointelegraph in an interview that it is moving forward with plans to deploy 199,000 new machines byย 2023ย to secure what is โarguably the future of the global monetary system.โ
GEM Mining CEO John Warren said via email that it โplans to have 32,000 miners online by the end of 2022.โ
For Marathon, that would be more than a six-time increase in size whereas GEMโs capacity would double if it follows through with its plans.
The fact that miners are expanding their operations comes as somewhat of a surprise. Late last week, concerns were raised about the capital efficiency of miners as it was reported that many were selling off BTC in order to maintain cash reserves. Marathon Digital filed with the SEC to sell up to $750 million worth of its stock on Feb. 13.
However, Schumacher clarified that the company is keeping its options open and โis in a position to better work through capital marketsโ while it looks for the most economically efficient way towards growth. He said that โfiling to shelf doesnโt mean they are necessarily selling. Everything we do is about increasing optionality.โ He continued
โWe canโt control the price of BTC, but we can control how we react to the market. We believe we are in a position to act opportunistically.โ
Warren shares optimism about growing his companyโs scale. He told Cointelegraph that GEM has also not sold any BTC to date.
His temperament can be derived in part by the potential capital efficiency provided by newly proposed tax incentives in Illinois and Georgia. If passed, the Illinois bill would offer tax breaks for crypto mining data centers, while Georgia would reduce taxes on electricity used for crypto mining.
Whereas Marathonโs strategy appears to be securing greater sources of revenue, GEM is seeking out ways to reduce expenses. Warren said, โState tax incentives for mining are tremendously beneficial to companies like GEM Mining due to their effects on the cost of energy use.โ
โEnergy is one of the most significant inputs for mining operations, and tax breaks that exempt the sale or use of electricity can assist with reducing overhead costs and maintaining cash flows.โ
Both Schumacher and Warren acknowledged the possibility for turbulence in Bitcoin price over the next coming months. Schumacher would not comment on whether we are entering a โcrypto winterโ, but made it clear that his company focuses on โdecreasing risk and making sure that we can pivot.โ
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Conversely, Warren commented that we are โmore likely in a short-term bearish sentiment within the market.โ He concluded by saying
โI anticipate there will be continued investment in bitcoin and the larger crypto space, regardless of short-term volatility.โ
