Public Keys: Coinbase Emerges Victorious, Marathon Reports Amid Bitcoin’s Turbulent Phase

Public Keys is a new weekly summary from Decrypt that highlights the major publicly traded cryptocurrency companies. This term encompasses a wide scope, including crypto exchange Coinbase, Michael Saylor’s Bitcoin-accumulating strategy, Jack Dorsey’s crypto payments platform Block, Inc., and various publicly listed crypto mining firms.

This week’s edition centers on Bitcoin miner Marathon’s significant achievement in Q4, and why this success hasn’t swayed analysts to boost their ratings. Additionally, crypto exchange Coinbase has had its SEC lawsuit dismissed, miner Hut 8 is set to announce its full-year earnings on Monday, and its rival Bitfarms has received approval to proceed with its merger with Stronghold.

MARA’s record-high revenue

Marathon Digital, the largest publicly traded cryptocurrency mining company with a market cap of $4.7 billion, announced a record-high Q4 quarterly revenue of $214 million on Wednesday.

It’s important to mention that the company recently changed its name to MARA; however, we will continue to refer to it as Marathon to avoid any confusion with its stock ticker.

This represents a 37% increase over its Q4 2023 performance, which exceeded analysts’ expectations. This gain is particularly significant given that last year’s Bitcoin halving dramatically reduced the rewards received by miners. (This mechanism is designed to control Bitcoin’s inflation rate and is embedded in its code, but it becomes a talking point every four years as miners and traders adjust to the new conditions.)

Nevertheless, one would think that analysts following Marathon, trading on the Nasdaq under the MARA ticker, would be praising the company’s performance. However, that hasn’t been the case.

It has become increasingly challenging to maintain low costs for each Bitcoin mined. As the current block reward is now 3.125 Bitcoin, miners are striving to gain an advantage by deploying additional mining rigs and reducing energy expenses.

Marathon has addressed this issue by aiming to evolve into a “vertically integrated energy and technology solutions provider.” According to CEO Fred Thiel, the company successfully tripled its energy capacity in 2024 from 0.5 to 1.7 gigawatts by harnessing excess natural gas and wind farms.

However, like many of its peers, Marathon’s profitability is heavily influenced by Bitcoin prices—something analyst Stephen Ayers describes as “inherently unpredictable.”

For instance, Marathon experienced an increase in the value of its BTC treasury by $443 million in Q4. But this can fluctuate; the market recently saw Bitcoin dip below $80,000.

The research firm Bernstein has previously praised Bitcoin miners, yet it has expressed more favorable comments about smaller competitors like Cleanspark and Riot Platforms compared to the Florida-based company.

Coinbase SEC lawsuit dismissed

Last week, the Securities and Exchange Commission agreed in principle to dismiss its lawsuit against crypto exchange Coinbase. Consequently, Coinbase, traded on the Nasdaq under the COIN ticker, finished the week above $235.

By the time the SEC officially confirmed the dismissal this week, the positive impact on the company’s share price had diminished, with Coinbase shares closing at approximately $208.37 yesterday.

Observers have noted that the company and its executives have invested tens of millions in political donations, including $70 million to Fairshake, a super PAC supportive of crypto.

Meanwhile, the recent market downturn has significantly increased trading volumes on the exchange. In just one day, Coinbase reported a 65% spike in volume, according to data from CoinGecko.

Ones to watch: Hut 8 earnings and Bitfarms merger

Hut 8, which trades on the Nasdaq under the HUT ticker, will announce its full-year 2024 results on Monday, March 3. Although the presentation will cover the previous year, analysts will likely focus on updates regarding its Vega Project.

In a performance update from January, Hut 8 CEO Asher Genoot hinted that the project—which features a “~15 EH/s colocation agreement with BITMAIN”—is expected to be ready for “energization” in Q2 of this year. The company has also been directing investments toward AI data center development.

Bitmain, a privately owned Chinese manufacturer of crypto mining equipment, specifically ASICs (application-specific integrated circuits), currently holds approximately 80% of the global market for Bitcoin mining hardware, according to Bitstamp, a Luxembourg-based crypto exchange.

Additionally, Bitfarms, trading on Nasdaq under the BITF ticker, recently gained shareholder approval for its merger with Stronghold. This is the same Bitcoin mining company that successfully resisted a hostile takeover attempt from Riot Platforms a few months back.