MARA already bought $3.9B worth of bitcoins, taking a 'full HODL' approach

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Quote from: icalical on December 11, 2024, 06:36:59 AM

Kinda cool that Marathon Digital MARA is doing something like MicroStrategy with grabbing Bitcoin via convertible notes. But really, buying huge amount of BTC at an average price of $95,395 apiece does sound rather risky, especially that it's an institution, and we know how volatile Bitcoin is. More generally speaking, while MARA stock has rallied, using significant amounts of debt to purchase BTC can come back to haunt during downturns in the market. In the event of a serious Bitcoin drawdown, MARA would be placed into financial distress, something similar to questions of MicroStrategy's purchases of BTC with debt. This strategy could work out great if the bull run continue but it definitely has its risks.

Any investment has risks, not just bitcoin, especially the higher the return the greater the risk.

For a company with an $8 billion market cap, spending nearly $4 billion on bitcoin is a risky decision, but let's not forget that MARA is a cryptocurrency mining company. So it is understandable and absolutely correct that the majority of their assets are in bitcoin. They are one of the companies in the crypto industry, I believe they know more about bitcoin than any organization or company, including MicroStrategy. So I don't think we need to worry about them because they know what they are doing.

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Quote from: icalical on December 11, 2024, 06:36:59 AM

Kinda cool that Marathon Digital MARA is doing something like MicroStrategy with grabbing Bitcoin via convertible notes. But really, buying huge amount of BTC at an average price of $95,395 apiece does sound rather risky, especially that it's an institution, and we know how volatile Bitcoin is. More generally speaking, while MARA stock has rallied, using significant amounts of debt to purchase BTC can come back to haunt during downturns in the market. In the event of a serious Bitcoin drawdown, MARA would be placed into financial distress, something similar to questions of MicroStrategy's purchases of BTC with debt. This strategy could work out great if the bull run continue but it definitely has its risks.

I think they wouldn't do it if they didn't believe in doing it with a good PNL.
Maybe they know something.
Or they have a firm belief.
Let's see how it will go for them during this cycle.

icalical

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Kinda cool that Marathon Digital MARA is doing something like MicroStrategy with grabbing Bitcoin via convertible notes. But really, buying huge amount of BTC at an average price of $95,395 apiece does sound rather risky, especially that it's an institution, and we know how volatile Bitcoin is. More generally speaking, while MARA stock has rallied, using significant amounts of debt to purchase BTC can come back to haunt during downturns in the market. In the event of a serious Bitcoin drawdown, MARA would be placed into financial distress, something similar to questions of MicroStrategy's purchases of BTC with debt. This strategy could work out great if the bull run continue but it definitely has its risks.

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Quote from: PremiumcryptoHub on November 29, 2024, 12:09:55 PM

MARA bought $100 million worth of bitcoins, taking a 'full HODL' approach

Marathon Digital Holdings was founded in 2010 and has been mining Bitcoin ever since. In recent times Marathon (MARA) they have been buying bitcoins on a regular basis. They have even already purchased 34,794 Bitcoins.

seems like they were focused on mining more than anything and despite publicly mining and holding for years the first time they sold some bitcoins was on january last year and they said that they sold some to pay some of their expenses to operate and for other corporate purposes

i wonder if they will also try to take advantage of the increase in price this year and the next following months too if they want to earn some money to continue operating efficiently

Quote

Last November 25, MARA purchased a total of 6474 bitcoins with the convertible note offer. By slowly and regularly buying bitcoins they may become big investors in the world in the future as MicroStrategy has become.

microstrategy has a ton of bitcoin and that standard may be difficult to reach for other companies

especially for a mining company it seems shocking that they only have what is just more or less 10% of what microstrategy have i am sure though that they will try and accumulate more bitcoin probably before next year start so that they can maximize their profit

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Kudos to them.
As it was said - they reap what they sow.
As years pass, more and more corpos are hopping onto the train, which has more pros, than cons, in the broader picture.

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Using the proceeds from its zero-coupon convertible notes offerings, MARA has acquired 11,774 BTC for ~$1.1 billion at ~$96,000 per #bitcoin and has achieved BTC Yield of 12.3% QTD and 47.6% YTD. As of 12/9/2024, we hold 40,435 BTC, currently valued at $3.9 billion based on a spot BTC price of $96,500.

https://x.com/MARAHoldings/status/1866467993183543461?t=4OufNOn5WJ8nEg6bzVyKsQ&s=19

Mining company Marathon (MARA) has already managed to purchase BTC40,435 Bitcoins, they continue to buy Bitcoins continuously. After offering $700 million in convertible notes, they bought BTC6,474 bitcoins at once, Then on December 9, MARA again bought BTC11,774 bitcoins worth $1.1 billion. The company has a total of BTC40,435 bitcoins, with a current value of around $3.9 billion. They are now second only to Microstrategy in terms of Bitcoin investment.

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Quote from: freedomgo on November 30, 2024, 05:25:41 AM

Quote from: nelson4lov on November 29, 2024, 05:42:59 PM

Microstrategy is winning. Who doesn't love a winning strategy? In an ideal world, everyone aspires to be a winner so I won't be surprised if more companies start adopting that playbook. With Bitcoin hitting $100K soon and US's pending treasury reserves in Bitcoin implementation, it's going to full FOMO season for Bitcoin.

That kind of big news could trigger a full-blown bull run. If it happens, it won’t just be the US considering Bitcoin as a strategic national reserve, other countries are likely to follow. But until Trump start sitting as president this will probably stay in the realm of speculation for now.

~Snipped
[...]

That's right — I think I heard even the Germany government have started considering to buy back Bitcoin if US goes in full sizing moves to fuel up their reserves with Bitcoin. But it's too bad for them because it would appear that they sold the bottom and will now have to buy here or even at more higher prices.

Btw, thanks for the link on Microstrategy's convertible notes along with the brief explainer.

_____________________

Quote from: shield132 on November 30, 2024, 05:58:15 AM

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I prefer 2016 when Bitcoin-related services weren't much regulated, were kyc-free and people didn't have to pay taxes on it.

We knew this was going to happen at some point. Most of the early bitcoiners all wanted the price to go up and it doesn't go up as much as everyone wants except wall street with their deep pockets buys. It's a price we had to pay. They can manipulate the price but not the network.

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Quote from: pooya87 on November 29, 2024, 11:05:30 PM

Maybe, but I think it is mostly the media that has changed. They advertise these things in a positive light and always associate them with the price rise. They are doing it with governments involvement in the crypto scene as well. A decade ago any topic with "government" and "bitcoin" in it was about how centralization is bad. These days, specially after US elections, people are excited about the same centralization! because the mainstream media has been putting lipstick on that pig, so to speak...

Actual Bitcoin users can take care of their bitcoins, wallets, inputs and outputs for their transactions well, and this way makes them feeling more loving Bitcoin as a tool for them to achieve security, privacy and somewhat anonymity.

Most of others don't care about it, they simply care about price, profit, ROI for their investment and they even don't care about how Bitcoin blockchain works. We can not change them, but if they can help to increase money inflow, it will be helpful for Bitcoin market to have bigger demand, higher price, bigger market cap. They are parts of Bitcoin history from adoption to price growth with time, and I don't feel bad because they joined this market with non-tech reasons.

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It's no secret though, it might have take time for this big institutions to buy Bitcoin because of the potential profits that they are going to make. But for us, average, we have been doing it ever since.

And according to them, there are a lot of companies who are buying,

https://x.com/River/status/1858554395169784106

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Quote from: pooya87 on November 29, 2024, 10:11:19 PM

Big whales are accumulating bitcoin like always, ... or maybe more now than before. But what's interesting is that some years ago such news worried people and nobody liked the idea. However, today people get excited about it for some reason! and call it "HODL". Tongue

It worries me and makes me happy at the same time because the medal has two sides. The positive side of news like this is that it strengthens Bitcoin as an investment option and it gives everyone confidence to invest in Bitcoin, overall this creates a positive environment and Bitcoin investment will return good profits.
Btw as I said, medal has two sides and there is a negative side with these news. The more these companies invest, the higher power and influence they have over Bitcoin. This gives them the ability to manipulate Bitcoin's price and more adoption also sets more regulations on Bitcoin.

I prefer 2016 when Bitcoin-related services weren't much regulated, were kyc-free and people didn't have to pay taxes on it.

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Quote from: nelson4lov on November 29, 2024, 05:42:59 PM

Microstrategy is winning. Who doesn't love a winning strategy? In an ideal world, everyone aspires to be a winner so I won't be surprised if more companies start adopting that playbook. With Bitcoin hitting $100K soon and US's pending treasury reserves in Bitcoin implementation, it's going to full FOMO season for Bitcoin.

That kind of big news could trigger a full-blown bull run. If it happens, it won’t just be the US considering Bitcoin as a strategic national reserve, other countries are likely to follow. But until Trump start sitting as president this will probably stay in the realm of speculation for now.

Quote from: nelson4lov on November 29, 2024, 05:42:59 PM

Btw, I don't know much about selling convertible stocks notes so I'll have to read more on that. As long as they're buying bitcoin, looks good to me.

I think this will give you an idea on how its computed, (pls. read the full article)
https://www.microstrategy.com/press/microstrategy-completes-3-billion-offering-of-convertible-senior-notes-due-2029-at-0-coupon-and-55-conversion-premium_11-21-2024

Quote

The notes are convertible into cash, shares of MicroStrategy’s class A common stock, or a combination of cash and shares of MicroStrategy’s class A common stock, at MicroStrategy’s election. Prior to June 1, 2029, the notes are convertible only upon the occurrence of certain events and during certain periods, and thereafter, at any time until the second scheduled trading day immediately preceding the maturity date.

From what I understand, it’s like you have trusted your money with them for a set period, usually long term. Once the bond matures, you can sell it at whatever the price is at that time. However, if we analyze closely, It’s all in their favor as they can set a share price lower than the actual profits your money has made, especially if Bitcoin’s price has gone up.

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Quote from: Pi-network314159 on November 30, 2024, 01:05:14 AM

Quote from: sunsilk on November 30, 2024, 12:22:42 AM

We're seeing more of these companies exposing themselves how much they own. It's encouraging but scary at the same time. They will have more power to the market with the volume of Bitcoins that they're holding because everyone will follow them so as what they do.

There is no point being scarry of company buying bitcoin because the more they buy and HODl the more they make bitcoin relatively scarce and expensive. If you are being afraid that they will sell, others will buy and the market keep going. One important thing is that not all companies that bought bitcoin will sell at once even if they have controle on the market. And Morover checking the total number of bitcoin HODLers they are not HODLing up to %50 of the total supply of bitcoin. If we are going go be afraid is when %50 and above of all supply is held by bitcoin HODLer like company, otherwise for now they have no much authority in the market.

That's true that they're making the supply smaller and that's even what makes me worried although I am just a small fish in this big ocean. But you're right as well that if ever they start dumping the holdings they have, there are always buyers willing to take over those sold Bitcoins.

AFAIK, they just can't sell everything all at once and it's going to be in sequences and batches. But I guess that I'll have to look at the brighter side on this that they're helping Bitcoin's demand to become higher and make the price better.

There's always the two side but weighing in, the better one is the positive that we're having right now that makes the price goes up.

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Quote from: sunsilk on November 30, 2024, 12:22:42 AM

We're seeing more of these companies exposing themselves how much they own. It's encouraging but scary at the same time. They will have more power to the market with the volume of Bitcoins that they're holding because everyone will follow them so as what they do.

There is no point being scarry of company buying bitcoin because the more they buy and HODl the more they make bitcoin relatively scarce and expensive. If you are being afraid that they will sell, others will buy and the market keep going. One important thing is that not all companies that bought bitcoin will sell at once even if they have controle on the market. And Morover checking the total number of bitcoin HODLers they are not HODLing up to %50 of the total supply of bitcoin. If we are going go be afraid is when %50 and above of all supply is held by bitcoin HODLer like company, otherwise for now they have no much authority in the market.

sunsilk

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We're seeing more of these companies exposing themselves how much they own. It's encouraging but scary at the same time. They will have more power to the market with the volume of Bitcoins that they're holding because everyone will follow them so as what they do.

Remember that they're not going to hold forever and there will be point of time that they'll sell. But the advantage is still on us, we just go along whatever they do or they do whatever we do. So if they're buying and so as we, it's best for everyone prepare for the best and the worse for the outcome of these accumulation they are having.

Getting the idea there, if they're buying a bunch of Bitcoin continuously, what could be the reason for small fish like me won't do the same? That's why, we HODL, we DCA.

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Quote from: PremiumcryptoHub on November 29, 2024, 12:09:55 PM

Last November 25, MARA purchased a total of 6474 bitcoins with the convertible note offer. By slowly and regularly buying bitcoins they may become big investors in the world in the future as MicroStrategy has become.

As an individual, I would not buy Bitcoin with borrowed funds. But these big firms like MARA and MicroStrategy seem to have so much confidence in Bitcoin that they would issue convertible notes to raise money for buying Bitcoin. MARA's convertible notes will be due by the first quarter of 2030 but could be redeemed by 2028 if the investment is profitable. Maybe the company is targeting to sell in the next bull run and optimistically they would make enough profit from this risk.

Quote from: pooya87 on November 29, 2024, 11:05:30 PM

Maybe, but I think it is mostly the media that has changed. They advertise these things in a positive light and always associate them with the price rise. They are doing it with governments involvement in the crypto scene as well. A decade ago any topic with "government" and "bitcoin" in it was about how centralization is bad. These days, specially after US elections, people are excited about the same centralization! because the mainstream media has been putting lipstick on that pig, so to speak...

I guess the lipstick is the constant rise in the high price of Bitcoin. The majority of people don't care about privacy or decentralization, all they want is more money. Maybe the media is gradually mispresenting the main reason why Bitcoin was created and new Bitcoiners are buying the misconceptions.

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Quote from: Poker Player on November 29, 2024, 10:14:14 PM

I guess years ago people were still more purist with the initial idea of P2P but now seen that there is an institutional adoption that we can't do anything about, the good thing about it is that it drives the price up.

Maybe, but I think it is mostly the media that has changed. They advertise these things in a positive light and always associate them with the price rise. They are doing it with governments involvement in the crypto scene as well. A decade ago any topic with "government" and "bitcoin" in it was about how centralization is bad. These days, specially after US elections, people are excited about the same centralization! because the mainstream media has been putting lipstick on that pig, so to speak...

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It is not the only company, and it is something that is going to be quite common in the coming years, greatly increasing demand and therefore driving up the price. I think Saylor's move will be studied in economics and business schools in the future.

Quote from: pooya87 on November 29, 2024, 10:11:19 PM

Big whales are accumulating bitcoin like always, ... or maybe more now than before. But what's interesting is that some years ago such news worried people and nobody liked the idea. However, today people get excited about it for some reason! and call it "HODL". Tongue

I guess years ago people were still more purist with the initial idea of P2P but now seen that there is an institutional adoption that we can't do anything about, the good thing about it is that it drives the price up.

pooya87

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Big whales are accumulating bitcoin like always, ... or maybe more now than before. But what's interesting is that some years ago such news worried people and nobody liked the idea. However, today people get excited about it for some reason! and call it "HODL". Tongue

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MARA's main asic farms are texas grid powered which is rated at $0.07/kwh on a 2 year industrial contract
which when also using a 2 year hardware lifecycle, convert the current mining cost to be $73k/btc

so mara are pre-buying coin in anticipation of future mining costs being over $100k, so they have trust and done the maths of the costs/price being higher soon enough to want to hoard more now

right now this second it doesnt make sense to buy coin at $98k when their mining costs are only $73k, but they are planning the 2025 future costs
EG they have 5.9% of network meaning of the 164kbtc being mined in 2025 they will only get max of 9.68k btc in 2025. so if they have customer contracts wanting more then that in 2025 and the mining costs are higher then $100k in 2025, then its a good deal to stock up on coin now rather than mine slowly over the year at the rising cost

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Quote from: nelson4lov on November 29, 2024, 05:42:59 PM

Microstrategy is winning. Who doesn't love a winning strategy? In an ideal world, everyone aspires to be a winner so I won't be surprised if more companies start adopting that playbook. With Bitcoin hitting $100K soon and US's pending treasury reserves in Bitcoin implementation, it's going to full FOMO season for Bitcoin.

Michael Saylor and MicroStrategy are game changers in traditional market and Bitcoin market. They initiated a new method of convert company asset, raise fund from customers and invest in Bitcoin build up massive wealth for everyone engaged.

Other companies see this successful method, and it's reasonable that they don't ignore this open-access investment method, apply it for their companies and get success like MicroStrategy. I would like to stay with a classic advice, following the leader, in this case the leader of this method is MicroStrategy. Why people ignore MicroStrategy and invest money into other companies that are late comers and copied strategy of MicroStrategy, it's unreasonable decision.

Topic: MARA already bought $3.9B worth of bitcoins, taking a 'full HODL' approach (Read 291 times)