U.S. firm buys 70,000 Bitcoin miners for $170 million

United States cryptocurrency mining firm Marathon Patent Group acquired 70,000 S-19 ASIC Bitcoin miners from Bitmain, for $170 million.

According to a Dec. 28 announcement, following the delivery of the order of the application-specific integrated circuit (ASIC) mining rigs, Marathon Patent Group will reportedly control over 103,000 miners capable of producing 10.36 Exahertz (EH/s). The firm’s chairman and CEO, Merrick Okamoto, said:

“This purchase is the largest order in dollar terms as well as the single largest order for S-19 ASIC miners that Bitmain has ever received. We appreciate the hard work their team is putting in to fulfil this order as well as the 30,000 S-19 miners we have purchased since August 2020.”

As part of the agreement, Marathon Patent Group expects to receive an initial batch of 7,000 S-19 miners in July 2021 and the final shipment in December 2021. The firm notes that “these miners more than triples the size of Marathon’s existing fleet of 33,000 miners.” The firm is publicly traded on the Nasdaq stock exchange and its stocks are trading at $13.53 after growing 1,188% year to date.

A major change in the mining industry

Miners worldwide saw little regulation or even attention by governments for many years after Bitcoin first launched little over ten years ago. Most of them enjoyed the lack of oversight since it allowed them to manage their operations freely, until authorities started noticing them—and more importantly the enormous amount of power they require—and showing hostility to this new industry.

For instance, local regulators in Plattsburg, N.Y., outright banned the establishment of new farms. Still, with time governments started to view the activity more favorably and started instead treating it as another activity to tax.

This resulted in previously unthinkable actions such as the U.S. Department of Energy’s decision to grant Canadian crypto mining firm DMG Blockchain Solutions an energy export license. In late August, venture capital firm Digital Currency Group launched an initiative explicitly aiming to create greater access to digital asset mining in North America.

It is also a step towards bringing more mining power into the U.S. from China, where the majority of bitcoins are mined. In late November the U.S. director of national intelligence, John Ratcliffe, asked then-chairman of the Securities and Exchange Commission Jay Clayton to look into China’s ability to control bitcoin and other cryptocurrencies if the government pushed in-country miners to follow instructions.