Public Bitcoin mining companies strengthened their balance sheets in anticipation of the latest halving event, which occurred in April.

According to BlocksBridge Consulting’s analysis of financial earnings from 12 public miners, ten of them raised a combined $2 billion in gross proceeds from equity financing activities, anticipating a post-halving slump in profitability. The same group of companies raised $1.25 billion in the last quarter of 2023.

Marathon Digital, CleanSpark and Riot Platforms led the pack of companies raising capital in the previous quarter, accounting for 73% of the funds secured. At the end of March, Marathon, CleanSpark, and Riot together held $1.33 billion in cash and over 32,200 Bitcoin (BTC) worth more than $2.2 billion.

The second quarter of 2024 is likely to see lower funding activity. According to BlocksBridge Consulting, “less than $500 million of investment was poured into subscribing major public mining stocks” as of May 15. The report notes:

“The financing activities appear to have cooled down since Q2. [...] That said, the number is already higher than Q3 last year.”

Equity financing involves raising capital by selling shares of the company to investors. This tool can be used at various stages of a company’s lifecycle. Once a company is public, it can issue additional shares to raise more funds from investors.

Bitcoin mining companies using this approach usually seek to fund infrastructure, technological upgrades and operational costs, especially in preparation for the Bitcoin halving event, which reduces mining rewards by half roughly every four years. 

Miners reported mixed financial results for the first three months of 2024 as BTC prices and mining costs climbed. Riot Platforms posted a record net income of $211.8 million, marking a 1,000% increase from the same period last year. The strong results came even as Riot missed analysts’ forecasts due to higher mining costs and reduced Bitcoin production.

Core Scientific, which emerged from bankruptcy, reported $179.3 million in revenue over the period. Digital asset mining revenue exceeded mining costs of $68.4 million, resulting in a gross margin of 46%.

Marathon Digital also missed Wall Street analysts’ revenue estimates, citing bad weather and equipment failures. The company’s revenues increased 223% year-on-year to $165.2 million, according to its earnings report.

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