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- Marathon Digital has an exposure of 80 Million USD to one of their data centers.
- Compute North filed for the chapter 11 of bankruptcy just a couple of weeks ago.
- The Bitcoin mining company had a mission to become carbon neutral by 2022.
Digital Marathon’s Hefty Exposure
The crypto winter has become a hole in the ship carrying several industries in an endlessly deep ocean. It has affected the associated spaces since its eruption. Investors are well-aware of bankruptcy events including Voyager, Celsius and Three Arrows Capital. Well, another firm, Compute North, joined the list a couple of weeks ago. The event may affect BTC mining company Marathon Digital eventually.
Recently, Bloomberg reported that the organization has an exposure of over 80 MIllion USD in the troubled hosting provider. The Bitcoin mining firm reportedly invested 10 Million USD in convertible preferred stocks, 21.3 Million USD in unsecured senior promissory note within the organization and 50 Million USD in the bankrupted firm’s operating deposits and.
Digital Marathon installed 68,000 mining machines in Compute North’s wind powered Texas facility. About 40,000 of them still required regulatory approvals to use the energy. The data center filed for Chapter 11 of bankruptcy on 22nd September, 2022 following the extreme fall in BTC prices, a paramount rise in energy costs and fierce rivals in the space.
Burning Issue of Bitcoin Energy Consumption
The crowned asset has a total supply of 21 Million out of which 19.17 Million are circulating in the market according to CoinMarketCap. Experts believe that miners will complete the count by 2140. This is due to the halving process which increases asset’s mining difficulty everytime it occurs.
Digital Marathon uses an asset light approach to expand the operations through firms like Compute North. This also eliminates the need to throw a lot of money concerning the infrastructure required for mining proof-of-work cryptocurrencies. Proof-of-stake is considered a more sustainable approach to mine virtual currencies.
Reports suggest that Bitcoin consumes power to run countries like Venezuela and Philippines combined annually. If the operations remain consistent, the biggest crypto asset will solely become responsible for a 2 degree increase in global temperature.
The Bitcoin Mining Council reported that the assets use 60% power from renewable sources. But the data suggests that these sources have gone down from 42% in 2020 to 25% in 2020. This is largely due to China’s crackdown on digital assets as the miners had their hands on the country’s hydropower in abundance.
Marathon Digital CEO, Fred Thiel, told in 2021 that they are planning to become 100% carbon neutral by the first quarter of 2022, which they did not attain obviously. Recently, the second biggest asset Ethereum shifted their consensus algorithm from proof-of-work to proof-of-stake. Believers have faith that it will become a fierce rival to Bitcoin at some point in future.
Anurag is working as a fundamental writer for The Coin Republic since 2021. He likes to exercise his curious muscles and research deep into a topic. Though he covers various aspects of the crypto industry, he is quite passionate about the Web3, NFTs, Gaming, and Metaverse, and envisions them as the future of the (digital) economy. A reader & writer at heart, he calls himself an “average guitar player” and a fun footballer.
