Marathon Digital tumbled late Wednesday following the crypto miner's Q4 earnings report. Meanwhile, Bitcoin on Wednesday jumped above $60,000 in a move powered by an influx of institutional participation and the upcoming halving event in April. The top crypto rallied as high as $64,037 before paring gains after crypto exchange Coinbase reported technical issues. The new spot bitcoin ETFs continued swinging higher while cryptocurrency prices and related stocks rose broadly on the bounce.
Marathon Digital Earnings
Marathon Digital reported Q4 earnings of 66 cents per share, improving from a loss of $3.13 per share a year earlier and blowing by FactSet estimates of 9 cents per share. Revenue leapt 452% to $156.8 million to beat forecasts of $153.6 million. Excluding impacts from new Financial Accounting Standards Board (FASB) accounting rules for crypto assets, Marathon had a Q4 loss of 2 cents per share, which missed FactSet EPS expectations of 4 cents.
Fourth-quarter bitcoin production leapt 172% to 4,242. Marathon noted it sold 56% of the bitcoin it produced during the quarter to fund operating costs.
Full-year bitcoin production soared 210% to 12,852 BTC, driven by a 253% in Marathon's hash rate to 24.7 exahashes per second (EH/s). The hash rate is the computational power required to mine bitcoin. Marathon Digital CEO Fred Thiel said the company plans to grow its hash rate to 35 to 37 EH/s in 2024 and improve to 50 EH/s by the end of 2025.
The company also announced the launch of Anduro, a platform built on the bitcoin network that allows developers and members of the crypto community to create their own applications.
Marathon produced 1,084 bitcoins in January, up 58% year-over-year but down 42% from December, the company announced Feb. 5. Total network rewards fell 14% month-over-month, driven by a decline in transaction fees. As of Jan. 31, Marathon Digital held a total of 15,741 unrestricted bitcoin. Marathon's combined unrestricted cash and bitcoin holdings totaled $988.7 million at month-end.
MARA stock fell nearly 12% late Wednesday. Shares pared gains to 2.4% during trade Wednesday after leaping more than 8% premarket Wednesday.
Marathon Digital stock bolted nearly 81% over the past month through Wednesday's close.
Bitcoin Notches New Two-Year High
Bitcoin on Wednesday traded around $60,600 after surging as high as $64,037 — running further up against its late 2021 levels. The world's largest cryptocurrency jumped nearly 6% over the last 24 hours, according to CoinDesk data. In addition, bitcoin's market capitalization crossed the $1 trillion mark in mid-February for the first time in more than two years.
Bitcoin is now up 43% so far this year, with most of the gains coming after the spot bitcoin ETF launches in early January. The crypto is trading about 13% below its all-time-high of $68,990 from November 2021.
Ethereum Wednesday morning rose further against April 2022 levels, trading around $3,290. ETH peaked at $3,488 in early Wednesday trade before following bitcoin lower. The No. 2 crypto spiked 45% in 2024.
The newly-launched spot bitcoin ETFs on Wednesday surged nearly 6% despite bitcoin's trip.
BlackRock's iShares Bitcoin Trust has been the clear leader in fund inflows since the spot bitcoin ETFs launched Jan. 11 with roughly $6.54 billion in inflows as of end of day Feb. 27, according to BitMEX Research data. The Fidelity Wise Origin Bitcoin Fund ranks second at $4.475 billion in inflows. The ARK 21Shares Bitcoin ETF ranks third at $1.539 billion, followed by the Bitwise Bitcoin ETF with about $1.1 billion in inflows.
Grayscale Bitcoin Trust has recorded nearly $7.59 billion in outflows as of Feb. 26, which have steadily slowed. Still, Grayscale remains the leader in terms of assets, with $25.18 billion in assets under management, followed by iShares Bitcoin Trust at $8.07 billion.
Despite GBTC's outflows, the new ETFs have recorded $6.73 billion in inflows since launch, according to BitMEX Research.
Coinbase Stuck In Traffic
Coinbase pared gains to less than 1% after reporting technical issues due to a traffic surge. COIN stock advanced another 6.4% early Wednesday prior to the announcement.
"We are aware that some users may see a zero balance across their Coinbase accounts and may experience errors in buying or selling," Coinbase Support announced around 12:50 p.m. ET. "Our team is investigating this and will provide an update shortly. Your assets are safe."
The problem appeared to mainly impact retail accounts with various users on social media reporting issues accessing accounts or the Coinbase app.
"We are dealing with a LARGE surge of traffic - apologies for any issues you encounter," CEO Brian Armstrong posted on X, the social media site formerly known as Twitter. "The team is working to remediate."
Shares of the crypto exchange on Monday broke out above a buy point.
You can follow Harrison Miller for more stock news and updates on X/Twitter @IBD_Harrison
