Monday’s announcement from Tesla Inc (NASDAQ:TSLA) that it had officially changed its investment policy to allow for cash to be moved into cryptocurrencies, that it had already moved $1.5 billion into Bitcoin, and that it planned to start accepting Bitcoin as a payment for its cars was a game-changer for the crypto space for two reasons.
First, $1.5 billion is a massive chunk of demand, and one assumes this starts an engine of demand over time as it hardly seems likely this was a one-time move. So, one of the most valuable companies in the S&P 500 is now likely to be a consistent point of demand on the bid in the Bitcoin market.
Second, and likely more importantly, Elon Musk was one of the founders of PayPal, where he made his first fortune. He likely is as knowledgeable about the global payments landscape and its surrounding regulatory ecosystem as anyone on the planet. If he thinks Bitcoin is a viable long-term bet as a real store of value and medium of exchange, then who’s going to argue with him?
With that in mind, we take a look at some of the top speculative plays in the Bitcoin stock space, including: HIVE Blockchain Technologies Ltd (OTC US: HVBTF), Marathon Patent Group Inc. (NASDAQ: MARA), ISW Holdings Ord Shs (OTC US: ISWH), and Riot Blockchain Inc. (NASDAQ: RIOT).
HIVE Blockchain Technologies Ltd (OTC US: HVBTF) is a mainstay in the crypto mining investment game. Only recently has the stock started to show lights and bangs and catch everyone’s attention. But, again, this is with good reason.
HIVE owns state-of-the-art green energy-powered data centre facilities in Canada, Sweden, and Iceland which produce newly minted digital currencies like Bitcoin and Ethereum continuously on the cloud. Its deployments provide shareholders with exposure to the operating margins of digital currency mining as well as a portfolio of crypto coins.
HIVE Blockchain Technologies Ltd (OTC US: HVBTF) recently announced the purchase of 4,180 MicroBT WhatsMiner M31S+ next generation miners with an aggregate operating hash power of 334 Petahash per second (PH/s) as it continues to expand its bitcoin mining operations.
According to the release, with the addition of these 4,180 MicroBT WhatsMiner M31S+ Miners, HIVEs aggregate operating hash rate from Bitcoin mining to almost double to an estimated 653 PH/s. Based on the orders that have been placed, this new equipment is expected to be delivered in 9 tranches in 2021, with 180 miners delivered in April and 500 miners delivered in each month in the remainder of calendar 2021 commencing with May delivery.
The context for this announcement is a bit of a bid, with shares acting well over the past five days, up about 26% in that timeframe.
HIVE Blockchain Technologies Ltd (OTC US: HVBTF) pulled in sales of $17.3M in its last reported quarterly financials, representing top line growth of 9.2%. In addition, the company has a strong balance sheet, with cash levels far exceeding current liabilities ($22.1M against $12.6M).
ISW Holdings Ord Shs (OTC US: ISWH) is another increasingly interesting emerging player in the Bitcoin space, and one with a significantly smaller market cap at this stage, suggesting that more upside could be on the way here if the stock can play catch-up with the space.
The company formed a joint venture partnership with Bit5ive in May 2020 to build and deliver an elegant, powerful, and efficient data center pod design. The 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 (OTC US: ISWH) had big news out this morning as well: the Pod5 will be powered up into full operational launch in Pennsylvania on February 12, 2021.
“We are very excited to finally be ready to launch full mining operations at a time when margins are at historic levels following further strength in the value of cryptocurrency assets,” commented Alonzo Pierce, President and Chairman of ISW Holdings. “But make no mistake about it: we are doing this because we have a fundamental belief in the long-term future viability of cryptocurrency systems as stores of value and legitimate platforms for global commerce. We started diversifying our cash into Bitcoin nearly two years ago. And we partnered with Bit5ive early last year and began the design for our Pod5 unit when Bitcoin was still under $10,000 per coin.”
The company has been converting its cash into bitcoin, with its first transaction completed in March 2019, when Bitcoin was just $4k/coin. The launch of its Pod5 Datacenter is a profound development for the company.
The stock has been very strong over recent weeks, powered in part by expectations related to its Pod5, but also because of its telehealth success. According to company materials, ISWH ended the year with its seventh straight quarter of sequential revenue growth, and continues to project 2021 revenue growth of as much as 500% on a year-over-year basis this year (from a base exceeding $1 million in 2020) in its Telehealth and Home Healthcare Solutions segment, which is separate from performance related to its Cryptocurrency Mining and Mining Equipment segment.
ISW Holdings Ord Shs (OTC US: ISWH) has demonstrated rapid topline growth in its home healthcare operations with six 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 Proceso cryptocurrency mining and mining equipment segment over coming months.
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 you’re long this stock, then you’re liking how the stock has responded to the announcement. MARA shares have been moving higher over the past week overall, pushing about 55% to the upside on above average trading volume.
Marathon Patent Group Inc. (NASDAQ: MARA) managed to rope in revenues totaling $835K in overall sales during the company’s most recently reported quarterly financial data — a figure that represents a rate of top line growth of 159.6%, 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 ($17.7M against $1.1M).
Riot Blockchain Inc. (NASDAQ: RIOT) holds non-controlling investments in blockchain technology companies and is one of the most readily identified on any list of stocks in the crypto space. It’s a mainstay for traders in the space at this point, and for good reason.
Shares have vaulted higher as Bitcoin has powered ahead over recent months. The company’s primary mining facility is located in Massena, New York under a colocation agreement with Coinmint.
Riot Blockchain Inc. (NASDAQ: RIOT) most 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 (“Bitmain”). 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 you’re long this stock, then you’re liking how the stock has responded to the announcement. RIOT shares have been moving higher over the past week overall, pushing about 64% to the upside on above average trading volume. Shares of the stock have powered higher over the past month, rallying roughly 23% in that time on strong overall action.
Riot Blockchain Inc. (NASDAQ: RIOT) generated sales of $2.5M, according to information released in the company’s 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).
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