The Next Leg of the Bitcoin Stock Bull (NASDAQ: RIOT) (OTC US: ISWH) (NASDAQ: MARA) (NASDAQ: CAN)
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At long last, Bitcoin has broken above the $50k mark. That statement would seem unimaginable if it were beamed into the past by just 6 months, when BTC was trading at just a fifth of that price.
The alt-currency has been powered by an increasing air of legitimacy driven by confidence in its long-term viability as demonstrated by corporate giants accepting, investing in, or otherwise working with Bitcoin.
Large firms like Tesla and Mastercard showing support for crypto. Tesla last week revealed it had bought $1.5 billion worth of bitcoin and plans to accept the digital coin as payment for its products, while Mastercard said it will open up its network to some digital currencies. PayPal and BNY Mellon have also made big moves to support crypto. Square is another big player making Bitcoin friendly moves. Microstrategy has been a strong supporter as well. JPMorgan has been a leading supporter from the analytic side.
The list goes on and on. And all the while, central banks and regulators havent stepped in to throw any cold water on the situation, which is a huge implicit green light.
With that in mind, we take a look at some of the top speculative plays in the Bitcoin stock space, including: Riot Blockchain Inc. (NASDAQ: RIOT), ISW Holdings Ord Shs (OTCMKTS: ISWH), Marathon Patent Group Inc. (NASDAQ: MARA), and Canaan Inc. ADR (NASDAQ: CAN).
Riot Blockchain Inc. (NASDAQ: RIOT) is a mainstay for traders in the crypto space at this point, and for good reason. Shares have vaulted higher as Bitcoin has powered ahead over recent months.
The companys primary mining facility is located in Massena, New York under a colocation agreement with Coinmint.
Riot Blockchain Inc. (NASDAQ: RIOT) recently announced an expected 65% increase in bitcoin mining hash rate capacity resulting from the purchase and future deployment of 15,000 S19 Pro and S19j Pro Antminers from Bitmain Technologies Limited. The approximate $35 million purchase is comprised of 3,000 S19 Pro Antminers (110 TH) and 12,000 S19j Pro Antminers (100 TH). These additional miners are scheduled for receipt and deployment starting in May 2021 and continuing through October 2021.
According to the release, this new order of miners, combined with the Company’s prior miner purchases, is expected to significantly increase Riot’s estimated bitcoin mining hash rate from the previously announced 2.3 EH/s to 3.8 EH/s. The Company has been receiving and deploying new miners consistently through 2020, including this new purchase; the delivery schedule continues into the fourth quarter of 2021.
If youre long this stock, then youre liking how the stock has responded to the announcement. RIOT shares have been moving higher over the past week overall, pushing about 81% to the upside on above average trading volume.
Riot Blockchain Inc. (NASDAQ: RIOT) generated sales of $2.5M, according to information released in the companys most recent quarterly financial report. That adds up to a sequential quarter-over-quarter growth rate of 26.8% on the top line. In addition, the company has a strong balance sheet, with cash levels far exceeding current liabilities ($39.1M against $1.3M).
ISW Holdings Ord Shs (OTCMKTS: ISWH) is an emerging leadership name in the space, with a unique mining pod program built from its landmark partnership with Bit5ive.
The company has been hard at work over recent months. The Proceso Pod5 Datacenter is the result. Designed in partnership with Bit5ive, and geared primarily for the cryptocurrency mining industry, the Pod5 Datacenter offers next-generation dynamic self-management functionality, plug-and-play operation, virtually non-existent maintenance needs, and an industry best-in-class 1.06 Power Usage Effectiveness score.
ISW Holdings Inc (OTCMKTS: ISWH) recently announced that its Pod5 unit has just been switched on and is now live, set to generate nearly $3 million in annual revenues (at current BTC pricing).
But that is only the beginning for this company. Shortly after announcing the Pod5 launch, the company announced that it has started the process of sharply expanding its mining resources, now in negotiations toward the purchase of an additional large number of miners (between 300 and 900) in preparation for what it calls its “coming Phase 3 expansion in mining volume”.
That expansion involves assembling, equipping, and powering up additional Pod5 units, each of which houses 300 miners and is capable of driving roughly $2.9 million in annualized revenues at current cryptocurrency market pricing. Management is targeting the acquisition of 900 new miners capable of equipping three (3) new Pod5 units, which would lead to an additional $8.64 million in annualized revenues from mining activities at current market prices.
“We have managed to stick to the basic framework of our initial plan and timeline despite some inevitable delays related to the pandemic and supply chain issues as well as availability of mining machines,” commented Alonzo Pierce, President and Chairman of ISW Holdings. “We have been able to execute and stay on our path in the larger strategic vision we put in place for our cryptocurrency segment. In line with that vision, we are now ready to invest, expand, and grow, and to start directly capitalizing on the strong investments we made starting in May of last year. This next expansion in firepower is just the start.”
ISW Holdings Ord Shs (OTCMKTS: ISWH) has demonstrated strong growth in its telehealth segment, with seven consecutive quarters of sharp sequential growth. Its most recent quarter put the company on an annual run-rate to pull in more than $1.5 million in revenues not counting what appears to be significant growth brewing in its crypto mining and mining equipment segment over coming months as it continues to scale up operations.
Marathon Patent Group Inc. (NASDAQ: MARA) mines cryptocurrencies with a focus on the blockchain ecosystem and the generation of digital assets. The company currently operates its proprietary Data Center in Hardin MT with a maximum power capacity of 105 Megawatts. Once fully deployed, the Company will have 21,500 Antminer Bitmain S-19 Pro Bitcoin Miners in operation at this facility.
The Company also owns 2,060 advanced ASIC Bitcoin Miners at a co-hosted facility in North Dakota.
Marathon Patent Group Inc. (NASDAQ: MARA) most recently announced that it and DMG Blockchain Solutions Inc. have entered into a non-binding memorandum of understanding to form Digital Currency Miners of North America, which will be a U.S.-based non-profit entity whose mission is to create a better mining environment for North American miners, to help improve their financial performance, and to create North America’s first cooperative mining pool.
According to the release, Marathon Patent Group and DMG’s U.S. subsidiary, Blockseer, are working together to establish DCMNA, a non-profit entity focused on North American digital currency opportunities, including decentralizing the Bitcoin hashrate and providing more transparency for North American miners. DCMNA’s principal initiative is to create North America’s first cooperative mining pool by licensing Blockseer’s mining pool to all DCMNA members in a cooperative structure. Mining partners who are members will receive rebates based on the hash rate they contribute to the overall pool, thus improving the mining profitability of DCMNA members.
If youre long this stock, then youre liking how the stock has responded to the announcement. MARA shares have been moving higher over the past week overall, pushing about 36% to the upside on above average trading volume.
Marathon Patent Group Inc. (NASDAQ: MARA) pulled in sales of $835K in its last reported quarterly financials, representing top line growth of 159.6%. In addition, the company has a strong balance sheet, with cash levels far exceeding current liabilities ($17.7M against $1.1M).
Canaan Inc. ADR (NASDAQ: CAN) bills itself as a company that provides high-performance computing solutions to efficiently solve complex problems. In 2016, Canaan successfully initiated the production of its first 16nm chip and passed the test to receive Chinas national high-tech enterprise certification. In 2018, Canaan achieved major technological breakthroughs to launch the K210, the worlds first-ever RISC-V-based edge artificial intelligence (AI) chip, which is now widely used for access control in situations such as smart door locks and more.
Canaan Inc. is currently focused on the research and development of advanced technology, including such areas as AI chips, AI algorithms, AI architectures, system on a chip (SoC) integration and chip integration. Using the AI chip as its base, Canaan Inc. has established an intellectual value chain. Canaan Inc. also provides a suite of AI service solutions and is able to tailor these solutions to the needs of its partners.
Canaan Inc. ADR (NASDAQ: CAN) most recently announced that its revenue visibility has improved substantially in 2021 as a result of attaining purchase orders totaling more than 100,000 units of bitcoin mining machines from customers in North America. According to the release, many of those purchase orders were placed with prepayment and will likely occupy the Company’s current manufacturing capacity entirely for the full year of 2021 and beyond. With those fully committed purchase orders, the Company now enjoys a much higher degree of revenue visibility and more precise forecast.
Mr. Nangeng Zhang, Chairman and Chief Executive Officer of Canaan, commented, “We have changed our operations model in 2021. Previously we were selling bitcoin mining machines mostly to individual mining operators who may not have longer-term planning. In late 2020, we shifted our client base to mostly publicly traded companies and bitcoin-focused investment funds which tend to place sizable orders with longer-term commitment. As a result, we can now forecast our revenue much more precisely.”
The context for this announcement is a bit of a bid, with shares acting well over the past five days, up about 178% in that timeframe. Shares of the stock have powered higher over the past month, rallying roughly 305% in that time on strong overall action.
Canaan Inc. ADR (NASDAQ: CAN) managed to rope in revenues totaling $23.6M in overall sales during the companys most recently reported quarterly financial data a figure that represents a rate of top line growth of -75.3%, as compared to year-ago data in comparable terms. In addition, the company has a strong balance sheet, with cash levels far exceeding current liabilities ($56.7M against $24.4M).
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