Post-Halving, Bitcoin Miners Relying on Grids Brace for Reckoning, According to MARA

Bitcoin miners who continue to use grid-connected power sources will face challenges after the halving event in 2028, according to a shareholder letter from MARA Holdings (MARA).

"For miners who are still reliant on grid-attached power, the warning signs are clear. Energy expenses will continue to increase. The 2028 halving will likely lead to another industry-wide upheaval, and many may not survive," the letter stated.

This statement comes as the mining industry has been grappling with profitability issues following a recent halving event that reduced bitcoin rewards by half, causing some miners to seek alternative revenue sources in high-performance computing (HPC) and artificial intelligence (AI).

MARA, one of the major bitcoin miners, asserted that in this highly competitive market, miners must differentiate themselves or risk falling behind and struggling to maintain profitability. "Those who fail to differentiate will be relegated to being price takers in an increasingly competitive market."

The miner's proposed solution, which it claims to have already taken an "early lead" on, is to secure affordable energy, vertically integrate their operations, and expand beyond traditional bitcoin mining - hinting at the need for miners to cater to other computing needs such as AI and HPC.

"Our capacity to acquire sites and produce low-cost energy, activate depreciated hardware and energy assets, and operate a vertically integrated model – from software and hardware, and now, to energy generation – will give us greater control over costs." To achieve this, MARA recently purchased a wind farm in Texas to reduce the miner's power expenses.

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MARA also reported that it has increased the development and sales of data center infrastructure, which will serve as the foundation for any computing needs.

"Regardless of whether it's for bitcoin mining or AI inference, we believe our technologies will empower others to build while MARA provides the tools to deploy new systems and services, such as energy management, load balancing, and infrastructure," MARA stated.

The miner also disclosed its fourth-quarter earnings, with sales of $214.4 million surpassing the average analyst estimate of $187.8 million, according to FactSet data. MARA stock rose by more than 8% in post-market trading, while bitcoin dropped by 4.2% on Wednesday.

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