{"id":6898,"date":"2022-09-26T19:23:28","date_gmt":"2022-09-26T19:23:28","guid":{"rendered":"http:\/\/ci02ac4b76000026f9"},"modified":"2022-09-26T19:23:28","modified_gmt":"2022-09-26T19:23:28","slug":"bitcoin-miner-cleanspark-keeps-building","status":"publish","type":"post","link":"https:\/\/bitcoinmagazine.com\/business\/bitcoin-miner-cleanspark-keeps-building","title":{"rendered":"How Bitcoin Miner CleanSpark Keeps Building In The Bear Market"},"content":{"rendered":"
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It\u2019s no secret that the bitcoin bear market is bad right now. According to some metrics, it\u2019s one of the worst downturns in Bitcoin\u2019s young history. And few sectors of the Bitcoin economy are as harshly affected by current market conditions than miners. But bear markets are precisely when mining winners are separated from losers: The agile and smart teams build and survive as the overleveraged and unprepared teams fall prey to an adverse environment.<\/p>\n

One company that has continued to grow, acquire and build through the bear market is CleanSpark<\/a>, a publicly-traded bitcoin mining company based in Nevada. This article highlights some of the moves this team has made over the past several months, contextualized with a bit of the brutal state of the mining market, making CleanSpark\u2019s planning and execution all the more impressive and notable.<\/p>\n

Before continuing, it\u2019s important to note that this article is only for educational purposes. The author compiled this information and analysis to share as market commentary, not any form of advice. The author also owns no shares of CleanSpark nor has any other form of personal financial investment with the company.<\/p>\n

The Bitcoin Mining Bear Market<\/h2>\n

The bitcoin price is down roughly 70% from its record highs<\/a>. Hash price<\/a> \u2014 the dollar value of each unit of hash rate \u2014 is quickly approaching all-time lows. Almost every week, a new headline appears about lawsuits<\/a>, bankruptcies<\/a> and more bankruptcies<\/a> in mining. Miners struggle to stay operational, let alone outperform bitcoin<\/a>. Almost regardless of the data<\/a> someone looks at, the current bear market is messy and very much not fun.<\/p>\n

Despite all of this, the CleanSpark team continues to grow, buy and build as the next section explains. Priced in bitcoin, shares of CleanSpark are still slightly above where they started the year, according to data from TradingView, despite consistent broader market turmoil \u2014 not bad for a bear market.<\/p>\n

CleanSpark\u2019s Bear Market Moves<\/h2>\n

Plenty of mining companies act as \u201cpress release heroes\u201d by announcing and planning to grow but often failing to execute on schedule or at all. But since its first foray<\/a> into the mining sector in December 2020, CleanSpark has since grown<\/a> to 100 employees and 3 exahashes (EH) of online hash rate, with the hash rate tripling in the past year alone.<\/p>\n

CleanSpark has also been on a sustained shopping spree for mining hardware<\/a> even as market conditions worsened \u2014 or perhaps because of this. The company bought 4,500<\/a> Antminer S19s last October and 2,597<\/a> more the following month. In June, it bought purchase contracts for 1,800<\/a> Antminer S19 XPs. In July, the company scooped up 1,060<\/a> Whatsminer M30S. In August, it bought 3,400<\/a> more Antminer S19s, followed by an additional 10,000<\/a> Antminer S19j Pros in September.<\/p>\n

CleanSpark has also been closing new deals, partnerships and acquisitions almost every month this year, including $35 million in new financing (April<\/a>), a partnership with TMGcore (June<\/a>), a co-location agreement with Coinmint (July<\/a>), an 86 megawatt (MW) mining facility acquisition in Georgia (August<\/a>), and acquiring a turnkey mining site from Mawson (September<\/a>).<\/p>\n

And amid all this growth, the company\u2019s sound financials set it apart for having one of the lowest debt-to-equity ratios<\/a> in the entire public mining sector. Jaran Mellerud, a mining analyst at Arcane Research, said<\/a> of the company: \u201cCleanSpark’s combination of quality and low valuation makes it one of the most interesting bitcoin mining stocks going forward.\u201d<\/p>\n

A Brief History Of CleanSpark<\/h2>\n

CleanSpark represents a unique type of mining company unlike most other teams in this sector of the bitcoin market, namely an energy company that transitioned into a mining company. Founded in 1987<\/a> as a software and energy company, CleanSpark started watching the mining industry only in the past couple of years. According to Matthew Schultz, CleanSpark\u2019s executive chairman, the company was performing its diligence on the mining sector throughout 2020 and saw the series of high-profile bitcoin investments from Square, Tesla and MicroStrategy as \u201cfurther validation<\/a>\u201d of the legitimacy of the industry. And in early August, it completed its transition from energy to mining by selling<\/a> its remaining energy assets to \u201cfocus completely on bitcoin mining.\u201d<\/p>\n

This transition gives CleanSpark a unique perspective on the market and something of an advantage to other mining-first companies that are merging or partnering with the energy industry. For example, CleanSpark knows well the obstacles facing partnerships and negotiations between the two industries, as CEO Zach Bradford said on a mining panel during the Bitcoin 2022 conference in Miami. <\/p>\n

\u201cNobody knows how to price in that much power for that consistent of a load,\u201d Bradford said<\/a>, referring to obstacles miners face when structuring deals with power companies.<\/p>\n

The End Of The Bear Market<\/h2>\n

It\u2019s anyone\u2019s guess when the bear market will be over. Miners and everyone else in the bitcoin market could be in for an even longer, more painful period ahead. But mining companies are already separating themselves during the market downturn in preparedness and capitalizing on opportunities in a depressed market. Bull markets are times of celebrations for all the effort put into growth during bear markets. Winners are truly made during bear markets, and this is no truer for any industry than bitcoin mining. <\/p>\n

Based on its path thus far, it would seem that CleanSpark has set itself up to be a winner.<\/p>\n

This is a guest post by Zack Voell. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

As many bitcoin mining firms struggle to remain operational, CleanSpark is poised to emerge from this bear market stronger than ever.<\/p>\n","protected":false},"author":2801,"featured_media":4333,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[1483,189,1425,422],"class_list":["post-6898","post","type-post","status-publish","format-standard","has-post-thumbnail","category-business","tag-bear-market","tag-bitcoin-mining","tag-cleanspark","tag-feature"],"author_data":{"id":2801,"name":"Zack Voell","nicename":"zack-voell","avatar_url":"https:\/\/secure.gravatar.com\/avatar\/752422daad6c455e7c730e136464e6c80ff641be43afa9e92230dfd835257e41?s=96&d=robohash&r=g"},"featured_image_url":"https:\/\/bitcoinmagazine.com\/wp-content\/uploads\/2024\/11\/bitcoin-mining-miner.png","_links":{"self":[{"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/posts\/6898","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/users\/2801"}],"replies":[{"embeddable":true,"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/comments?post=6898"}],"version-history":[{"count":0,"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/posts\/6898\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/media\/4333"}],"wp:attachment":[{"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/media?parent=6898"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/categories?post=6898"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/tags?post=6898"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}