Joe Gomes, CFA, Managing Director, Equity Research Analyst, Generalist , Noble Capital Markets, Inc.
Joshua Zoepfel, Research Associate, Noble Capital Markets, Inc.
Refer to the full report for the price target, fundamental analysis, and rating.
HPC and AI. As of November 30, 2024, Bit Digital had 266 servers actively generating revenue and earned approximately $4.3 million of total unaudited GPU Cloud revenue during the month. At Enovum’s data center, the Company had 13 customers actively generating revenue with colocation revenue of approximately $503,500. We believe the Boosteroid agreement, along with the two MSAs signed in the third quarter should expand revenue in the coming months.
Mining Side. The Company produced 44.9 BTC in the month, a 14.0% decrease from 52.2 BTC in October. The active hash rate was 2.51 EH/s, a slight increase from 2.43 EH/s last month. Bit Digital’s hosting provider, Coinmint, being acquired resulted in the termination of hosting contracts. Management has signed term sheets for the lost hosting capacity and is replacing energy inefficient miners, with a 3.0 EH/s active hash rate expected by the first half of 2025.
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*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision.
ATLANTA, Nov. 13, 2024 (GLOBE NEWSWIRE) — Bitcoin Depot Inc. (“Bitcoin Depot” or the “Company”), a U.S.-based Bitcoin ATM operator and leading fintech company, today reported financial results for the third quarter ended September 30, 2024. Bitcoin Depot will host a conference call and webcast at 10:00 a.m. ET today. An earnings presentation and link to the webcast will be made available at ir.bitcoindepot.com.
“During the third quarter, we made significant strides in expanding our Bitcoin ATM network while working to optimize existing machines for greater profitability,” said Brandon Mintz, CEO and Founder of Bitcoin Depot. “We ended the quarter with 8,300 machines, surpassing our goals and reflecting our team’s execution and vision to enhance Bitcoin’s accessibility.
“In the past year, we’ve focused on relocating underperforming BTMs to more promising locations, a strategy that historically boosts average profitability per kiosk over time. While this improvement may not be fully visible in our consolidated quarterly numbers, the strategy is proving effective. With our extensive kiosk footprint and these initiatives in place, we are confident in our ability to drive shareholder value moving forward.
“As a result of our continued cash flow generation, we believe that beginning a cash dividend to common shareholders in 2025 will be one of the ways we create value for shareholders.”
Third Quarter 2024 Financial Results
Revenue in the third quarter of 2024 was $135.3 million, down 25% from $179.5 million in the third quarter of 2023. This decline was largely driven by the impact of unfavorable legislation that was passed in California that went into effect in January 2024, along with the Company’s continued process of relocating underperforming kiosks in order to optimize fleet profitability.
Total operating expenses declined 13% to $16.9 million for the third quarter of 2024, compared to $19.5 million for the third quarter of 2023 due to costs of going public in 2023 that did not recur in 2024.
Net income for the third quarter of 2024 increased 116% to $2.3 million, compared to net income of $1.1 million for the third quarter of 2023. The increase was due to lower operating expenses in 2024, and expenses associated with the PIPE financing in the third quarter of 2023 that did not recur in 2024.
Adjusted gross profit, a non-GAAP measure, in the third quarter of 2024 was $22.4 million, down 17% from $26.9 million for the third quarter of 2023. Adjusted gross profit margin, a non-GAAP measure, in the third quarter of 2024 increased approximately 160 basis points to 16.6% compared to 15.0% in the third quarter of 2023. Please see “Explanation and Reconciliation of Non-GAAP Financial Measures” below.
Adjusted EBITDA, a non-GAAP measure, in the third quarter of 2024 decreased 34% to $9.2 million, compared to Adjusted EBITDA of $13.9 million for the third quarter of 2023. The decline was due to the lower revenue. Please see “Explanation and Reconciliation of Non-GAAP Financial Measures” below.
Cash and cash equivalents were $32.2 million as of the end of the third quarter of 2024. The Company generated $5.8 million in cash flows from operations in the third quarter and $17.3 million for the first nine months of 2024.
During the third quarter of 2024, the Company generated $5.8 million of cash flow from operations compared to $7.0 million in the third quarter of 2023.
Conference Call
Bitcoin Depot will hold a conference call at 10:00 a.m. Eastern time (7:00 a.m. Pacific time) today to discuss its financial results for the third quarter ended September 30, 2024.
Call Date: Wednesday, November 13, 2024 Time: 10:00 a.m. Eastern time (7:00 a.m. Pacific time) U.S. dial-in: 646-968-2525 International dial-in: 888-596-4144 Conference ID: 7631242
The conference call will broadcast live and be available for replay here following the call.
Please call the conference telephone number approximately 10 minutes before the start time. An operator will register your name and organization. If you have any difficulty connecting with the conference call, please contact Bitcoin Depot’s investor relations team at 1-949-574-3860.
A replay of the call will be available beginning after 2:00 p.m. Eastern time on November 13, 2024, through November 20, 2024.
U.S. replay number: 609-800-9909 International replay number: 800-770-2030 Conference ID: 7631242
About Bitcoin Depot
Bitcoin Depot Inc. (Nasdaq: BTM) was founded in 2016 with the mission to connect those who prefer to use cash to the broader, digital financial system. Bitcoin Depot provides its users with simple, efficient and intuitive means of converting cash into Bitcoin, which users can deploy in the payments, spending and investing space. Users can convert cash to bitcoin at Bitcoin Depot kiosks in 48 states and at thousands of name-brand retail locations in 29 states through its BDCheckout product. The Company has the largest market share in North America with approximately 8,300 kiosk locations as of September 30, 2024. Learn more at www.bitcoindepot.com.
This press release and any oral statements made in connection herewith include “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act of 1934, as amended. Forward-looking statements are any statements other than statements of historical fact, and include, but are not limited to, statements regarding the expectations of plans, business strategies, objectives and growth and anticipated financial and operational performance, including our growth strategy and ability to increase deployment of our products and services, our ability to strengthen our financial profile, and worldwide growth in the adoption and use of cryptocurrencies. These forward-looking statements are based on management’s current beliefs, based on currently available information, as to the outcome and timing of future events. Forward-looking statements are often identified by words such as “anticipate,” “appears,” “approximately,” “believe,” “continue,” “could,” “designed,” “effect,” “estimate,” “evaluate,” “expect,” “forecast,” “goal,” “initiative,” “intend,” “may,” “objective,” “outlook,“ ”plan,“ ”potential,“ ”priorities,“ ”project,“ ”pursue,“ ”seek,“ ”should,“ ”target,“ ”when,“ ”will,“ ”would,” or the negative of any of those words or similar expressions that predict or indicate future events or trends or that are not statements of historical matters, although not all forward-looking statements contain such identifying words. In making these statements, we rely upon assumptions and analysis based on our experience and perception of historical trends, current conditions, and expected future developments, as well as other factors we consider appropriate under the circumstances. We believe these judgments are reasonable, but these statements are not guarantees of any future events or financial results. These forward-looking statements are provided for illustrative purposes only and are not intended to serve as, and must not be relied on by any investor as, a guarantee, an assurance, a prediction or a definitive statement of fact or probability. Actual events and circumstances are difficult or impossible to predict and will differ from assumptions. Many actual events and circumstances are beyond our control.
These forward-looking statements are subject to a number of risks and uncertainties, including changes in domestic and foreign business, market, financial, political and legal conditions; failure to realize the anticipated benefits of the business combination; risks relating to the uncertainty of our projected financial information; future global, regional or local economic and market conditions; the development, effects and enforcement of laws and regulations; our ability to manage future growth; our ability to develop new products and services, bring them to market in a timely manner and make enhancements to our platform; the effects of competition on our future business; our ability to issue equity or equity-linked securities; the outcome of any potential litigation, government and regulatory proceedings, investigations and inquiries; and those factors described or referenced in filings with the Securities and Exchange Commission. If any of these risks materialize or our assumptions prove incorrect, actual results could differ materially from the results implied by these forward-looking statements. There may be additional risks that we do not presently know or that we currently believe are immaterial that could also cause actual results to differ from those contained in the forward-looking statements. In addition, forward-looking statements reflect our expectations, plans or forecasts of future events and views as of the date of this press release. We anticipate that subsequent events and developments will cause our assessments to change.
We caution readers not to place undue reliance on forward-looking statements. Forward-looking statements speak only as of the date they are made, and we undertake no obligation to update publicly or otherwise revise any forward-looking statements, whether as a result of new information, future events, or other factors that affect the subject of these statements, except where we are expressly required to do so by law. All written and oral forward-looking statements attributable to us are expressly qualified in their entirety by this cautionary statement.
Explanation and Reconciliation of Non-GAAP Financial Measures
Bitcoin Depot reports its financial results in accordance with accounting principles generally accepted in the United States of America (“GAAP”). This press release includes both historical and projected Adjusted EBITDA, Adjusted Gross Profit, and certain ratios and other metrics derived therefrom such as Adjusted EBITDA margin and Adjusted Gross Profit margin, which are not prepared in accordance with GAAP.
Bitcoin Depot defines Adjusted EBITDA as net income before interest expense, income tax expense, depreciation and amortization, non-recurring expenses, share-based compensation, expenses related to the PIPE financing and miscellaneous cost adjustments. Such items are excluded from Adjusted EBITDA because these items are non-cash in nature, or because the amount and timing of these items is unpredictable, not driven by core results of operations and renders comparisons with prior periods and competitors less meaningful. In addition, Bitcoin Depot defines Adjusted Gross Profit (a non-GAAP financial measure) as revenue less cost of revenue (excluding depreciation and amortization) and depreciation and amortization adjusted to add back depreciation and amortization. Bitcoin Depot believes Adjusted EBITDA and Adjusted Gross Profit each provide useful information to investors and others in understanding and evaluating Bitcoin Depot’s results of operations, as well as provide a useful measure for period-to-period comparisons of Bitcoin Depot’s business performance. Adjusted EBITDA and Adjusted Gross Profit are each key measurements used internally by management to make operating decisions, including those related to operating expenses, evaluate performance and perform strategic and financial planning. However, you should be aware that Adjusted EBITDA and Adjusted Gross Profit are not measures of financial performance calculated in accordance with GAAP and may exclude items that are significant in understanding and assessing Bitcoin Depot’s financial results, and further, that Bitcoin Depot may incur future expenses similar to those excluded when calculating these measures. Bitcoin Depot primarily relies on GAAP results and uses both Adjusted EBITDA and Adjusted Gross Profit on a supplemental basis. Neither Adjusted EBITDA or Adjusted Gross Profit should be considered in isolation from, or as an alternative to, net income, cash flows from operations or other measures of profitability, liquidity or performance under GAAP and may not be indicative of Bitcoin Depot’s historical or future operating results. Bitcoin Depot’s computation of both Adjusted EBITDA and Adjusted Gross Profit may not be comparable to other similarly titled measures computed by other companies because not all companies calculate such measures in the same fashion. As such, undue reliance should not be placed on such measures.
Due to the high variability and difficulty in making accurate forecasts and projections of some of the information excluded from the projections of Adjusted EBITDA, together with some of the excluded information not being ascertainable or accessible, Bitcoin Depot is unable to quantify certain amounts that would be required to be included in the most directly comparable GAAP financial measures without unreasonable effort. Consequently, no disclosure of estimated comparable GAAP measures is included and no reconciliation of the forward-looking non-GAAP financial measures is included.
The following table presents a reconciliation of Net (loss) income to Adjusted EBITDA for the periods indicated:
In the wake of recent elections, the stock and cryptocurrency markets have surged as investor optimism is fueled by FOMO (Fear of Missing Out). While this bullish momentum brings opportunities, it also signals caution, especially given the high volatility seen across markets. For investors, understanding the potential and risks in this unique environment is key to making wise decisions.
One notable trend is the recent outperformance of the Russell 2000 index, an index that tracks small-cap stocks, which has shown greater gains compared to larger indices like the S&P 500 and Nasdaq. This trend hints at potential opportunities within small-cap companies, but it’s crucial for investors to recognize the volatile backdrop surrounding these gains.
The Russell 2000 index, composed primarily of small-cap stocks, has experienced a significant uptick in recent weeks, outpacing some of the larger, more familiar indices. Small-cap stocks historically perform well during economic recoveries, as investors tend to favor companies with high-growth potential. Smaller companies often have greater room for expansion compared to established giants, which can lead to impressive returns if these firms capitalize on their growth potential.
For investors who can tolerate a higher level of risk, small-cap stocks within the Russell 2000 may offer appealing opportunities. However, even in an optimistic market, it’s essential to approach these investments carefully, as smaller companies tend to be more volatile and sensitive to economic shifts.
Post-election optimism isn’t unusual, and investors often flock to markets anticipating favorable policies or economic changes that could benefit various sectors. This year, that optimism is even more pronounced as both traditional and digital markets see upward momentum. The crypto markets are also surging, with certain tokens like Bitcoin reaching new highs alongside the rally in stocks. These gains across both asset types contribute to the FOMO effect, where investors feel compelled to jump in quickly, potentially without due diligence.
However, FOMO can lead to hasty decisions, as investors rush to capture potential gains without fully evaluating the risks. In the current climate, it’s critical to remember that the same forces driving prices up can lead to sudden drops as market conditions shift.
Despite these upward trends, the high volatility in both stock and crypto markets should serve as a caution flag. Small-cap stocks, while promising, are known for their vulnerability to rapid price swings. They’re also more likely to be affected by liquidity issues, which can amplify losses during sell-offs. Similarly, cryptocurrencies are notoriously volatile and subject to external forces such as regulatory changes, technological developments, and shifts in investor sentiment.
For those considering investments in these areas, being prepared for sudden price changes and being comfortable with the associated risks is essential.
To navigate these volatile waters successfully, investors should keep the following tips in mind:
Risk Assessment – Understanding your personal risk tolerance is crucial, especially with small-cap stocks and cryptocurrencies. Not every portfolio is suited for high-risk, high-volatility assets, so evaluate carefully before diving in.
Diversification – A diversified portfolio can help manage risk by balancing small-cap and cryptocurrency investments with more stable assets. This approach can soften the impact of any single asset’s fluctuations, creating a more resilient portfolio.
Due Diligence – For investors interested in small-cap stocks, doing thorough research is essential. Look for companies with solid fundamentals, promising growth potential, and innovative offerings that set them apart from competitors.
Stay Informed – Markets can shift quickly, especially during periods of economic or political change. Following relevant news and trends can help investors stay ahead of potential risks and make informed decisions when the market moves.
The post-election market surge brings both promise and caution. Investors looking to take advantage of small-cap stock outperformance or capitalize on crypto market gains should do so with a clear understanding of the risks. In a market driven by FOMO, a balanced approach that includes careful research, risk management, and diversification is key. With these strategies, investors can navigate today’s volatility effectively, capturing opportunities without losing sight of the inherent risks.
Key Points: – Bitcoin surged to $73,544, marking a 13% rise in October as inflation concerns grow. – Spot Bitcoin ETFs have accumulated $66 billion, adding stability and appeal to institutional investors. – Increased odds of a pro-Bitcoin presidency add speculative interest as the election nears.
Bitcoin reached a significant seven-month high of $73,544 on Tuesday, driven by a range of economic and political factors. With the U.S. presidential election just a week away, both major candidates have introduced policies that could impact fiscal stability and inflation rates. These potential economic shifts are increasing demand for Bitcoin as a hedge against inflation and a safe investment during times of uncertainty.
The cryptocurrency’s price increase of roughly 6% has led to an impressive 13% gain in October alone, far outperforming the 1% gain seen in the S&P 500. This recent surge extends beyond Bitcoin, as other major cryptocurrencies like Ethereum and Binance coin have also posted notable gains.
Bitcoin’s surge stems from a mix of inflation concerns, Fed policy changes, and favorable political sentiment. Economists anticipate that proposed government policies, especially those from presidential candidates Kamala Harris and Donald Trump, may lead to a rise in the national debt, which often heightens inflation concerns. As inflation worries grow, traditional and digital safe-haven assets have become increasingly appealing. Since the Federal Reserve cut interest rates last month, Bitcoin has risen as investors seek alternatives, especially since monetary policy may not fully address the inflation outlook.
Another factor is the approval of spot Bitcoin exchange-traded funds (ETFs) by U.S. regulators earlier this year, which has driven billions in inflows from institutional investors. Asset management giants like BlackRock, Fidelity, and Grayscale have collectively accumulated about $66 billion worth of Bitcoin in these ETFs, representing around 5% of the global Bitcoin market. This growing institutional support has added momentum to Bitcoin’s recent rally, increasing investor confidence.
Bitcoin’s status as a potential hedge against inflation has also been supported by recent moves in the gold market. Gold prices have risen 6% since the Fed’s rate cut, indicating a shift by investors toward assets that retain value during inflationary periods.
Bitcoin is currently the world’s largest digital currency, with a market cap that dwarfs other cryptocurrencies. Despite a turbulent history marked by the 2022 “crypto winter” and notable bankruptcies, such as the collapse of FTX, Bitcoin has recovered strongly, gaining over 300% from its 2022 lows. Today, it remains more than four times the size of the second-largest cryptocurrency, Ethereum.
The political landscape may also play a role in Bitcoin’s performance. Betting markets have shown an increase in the odds of a Trump victory, as the former president advocates for a national Bitcoin reserve. This pro-Bitcoin stance has drawn attention to the digital asset, especially among investors who view it as a more favorable environment for cryptocurrency adoption.
As the U.S. election approaches, Bitcoin may see continued interest from both institutional and individual investors. With the possibility of new fiscal policies that could further fuel inflation, Bitcoin’s role as a digital hedge remains a central narrative in its current price momentum.
Key Points: – Bitfarms to acquire Stronghold Digital Mining in a $175 million deal – Merger expands Bitfarms’ U.S. presence and power capacity significantly – Transaction aims to boost environmental efforts and diversify beyond Bitcoin mining
Bitfarms Ltd. has announced its plans to acquire Stronghold Digital Mining, Inc. in a deal valued at approximately $175 million in a strategic move that’s set to reshape the Bitcoin mining landscape. This bold acquisition, slated to close in the first quarter of 2025, marks a significant milestone in Bitfarms’ growth strategy and signals a new era for both companies in the ever-evolving cryptocurrency sector.
The all-stock transaction will see Stronghold shareholders receive 2.52 Bitfarms shares for each Stronghold share they own, representing a 71% premium based on recent trading prices. This merger is poised to create a powerhouse in the Bitcoin mining industry, combining Bitfarms’ operational expertise with Stronghold’s strategic assets and power generation capabilities.
At the heart of this acquisition is Bitfarms’ ambition to expand and rebalance its energy portfolio. The company aims to increase its presence in the United States dramatically, projecting that nearly 50% of its 950 MW energy capacity will be based in the U.S. by the end of 2025. This move aligns with Bitfarms’ strategic plan to diversify geographically and tap into new power sources.
Stronghold brings to the table 4.0 EH/s of current hashrate, with the potential to scale up to approximately 10 EH/s in 2025 through fleet upgrades. The acquisition also includes two merchant power plants in Pennsylvania, providing 165 MW of nameplate generated power capacity. These facilities are recognized for their environmental benefits, converting mining waste into power and contributing to land reclamation efforts.
Perhaps most intriguing is the transaction’s potential to propel Bitfarms beyond traditional Bitcoin mining. The company sees opportunities to leverage high-performance computing (HPC) and artificial intelligence (AI) capabilities, potentially merging these technologies with their Bitcoin mining operations. This diversification strategy could open new revenue streams and position the combined entity at the forefront of technological innovation in the crypto space.
Environmental considerations play a crucial role in this merger. Stronghold’s reclamation facilities have already rehabilitated thousands of acres of toxic waste sites, addressing historical environmental issues dating back to the 1800s. Furthermore, the potential for carbon capture projects could position Bitfarms as a leader in sustainable cryptocurrency mining practices.
The merger is expected to yield significant synergies, with an estimated $10 million in annual run-rate cost savings. This efficiency boost, coupled with the expanded power capacity and technological capabilities, positions the combined company to weather the cyclical nature of the cryptocurrency markets more effectively.
However, the road ahead is not without challenges. The transaction still requires approval from Stronghold shareholders and various regulatory bodies. Additionally, the volatile nature of cryptocurrency prices and the ever-changing regulatory landscape pose ongoing risks to the industry.
As the crypto mining sector continues to mature and face increased scrutiny over its energy consumption, this merger represents a forward-thinking approach to addressing both economic and environmental concerns. By vertically integrating power generation, expanding into strategic locations, and focusing on sustainable practices, Bitfarms is positioning itself as a leader in the next generation of cryptocurrency mining operations.
In conclusion, the Bitfarms-Stronghold merger is more than just a consolidation of assets; it’s a strategic bet on the future of Bitcoin mining and digital asset infrastructure. As the industry evolves, this union could serve as a blueprint for how cryptocurrency companies can adapt, grow, and contribute positively to both technological advancement and environmental stewardship.
Revenue of $163.1 Million With a Significant Expansion in Net Income to $4.4 Million Compared to Q1 2024
Exceeded Goal of Having Over 8,000 Active Bitcoin ATMs Five Months Ahead of Schedule
ATLANTA, Aug. 13, 2024 (GLOBE NEWSWIRE) — Bitcoin Depot Inc. (“Bitcoin Depot” or the “Company”), a U.S.-based Bitcoin ATM operator and leading fintech company, today reported financial results for the second quarter ended June 30, 2024. Bitcoin Depot will host a conference call and webcast at 10:00 a.m. ET today. An earnings presentation and link to the webcast will be made available at ir.bitcoindepot.com.
“We continued to build on our momentum in the second quarter, achieving notable sequential growth in revenue, net income, and Adjusted EBITDA,” said Brandon Mintz, CEO and Founder of Bitcoin Depot. “Our success of having over 8,000 active Bitcoin ATMs five months ahead of schedule underscores our robust execution and positions us well for sustained growth. This achievement not only enhances our market presence but also drives our cash flow dynamics, as evidenced by the $10.1 million in operational cash flow generated during the second quarter. With this strong foundation, we are well-positioned to expand our world-leading kiosk footprint and maximize profits for our shareholders.”
Second Quarter 2024 Financial Results
Revenue in the second quarter of 2024 was $163.1 million, down 17% from $197.5 million in the second quarter of 2023. Revenue in the second quarter of 2024 was up $24.5 million or 18% from the first quarter of 2024.
Total operating expenses were $18.8 million for the second quarter of 2024, compared to $19.7 million for the second quarter of 2023.
Net income for the second quarter of 2024 was $4.4 million, compared to a net loss of $4.0 million for the second quarter of 2023. Net income in the second quarter of 2024 was up $8.6 million or 203% from a net loss of $4.2 million in the first quarter of 2024.
Adjusted gross profit in the second quarter of 2024 was $26.4 million, down 13% from $30.2 million for the second quarter of 2023. Adjusted gross profit margin (non-GAAP) in the second quarter of 2024 increased approximately 90 basis points to 16.2% compared to 15.3% in the second quarter of 2023. Please see “Explanation and Reconciliation of Non-GAAP Financial Measures” below.
Adjusted EBITDA, a non-GAAP measure, in the second quarter of 2024 decreased 36% to $12.7 million, compared to Adjusted EBITDA of $19.8 million for the second quarter of 2023. Adjusted EBITDA in the second quarter of 2024 was up $7.8 million or 159% from the first quarter of 2024. Please see “Explanation and Reconciliation of Non-GAAP Financial Measures” below.
Cash and cash equivalents were $43.9 million as of the end of the second quarter of 2024. The Company generated $10.1 million in cash flows from operations in the second quarter and $11.5 million for the first six months of 2024.
Recent Business Highlights
Achieved and exceeded its goal of having over 8,000 active Bitcoin ATMs five months ahead of schedule, with 8,180 kiosks. This milestone reinforces Bitcoin Depot’s abiding market dominance and showcases its rapid growth trajectory.
Partnered with New England-Based convenience retailer Nouria Energy, a leading convenience store brand based in the northeastern U.S. with robust operations across 175 company owned c-stores and fuel retailers.
Announced Bitcoin treasury strategy, demonstrating the Company’s confidence in the future of Bitcoin by strategically allocating a portion of cash reserves to Bitcoin.
Announced sale of 200 additional BTM kiosks to Sopris Capital, a 20-year-old multi-strategy investment firm as part of the Company’s profit-sharing program.
Conference Call
Bitcoin Depot will hold a conference call at 10:00 a.m., Eastern time (7:00 a.m. Pacific time), today to discuss its financial results for the second quarter ended June 30, 2024.
Call Date: Tuesday, August 13, 2024 Time: 10:00 a.m. Eastern time (7:00 a.m. Pacific time) U.S. dial-in: 646-968-2525 International dial-in: 888-596-4144 Conference ID: 4727212
The conference call will broadcast live and be available for replay here following the call.
Please call the conference telephone number approximately 10 minutes before the start time. An operator will register your name and organization. If you have any difficulty connecting with the conference call, please contact Bitcoin Depot’s investor relations team at 1-949-574-3860.
A replay of the call will be available beginning after 2:00 p.m. Eastern time on August 13, 2024, through August 20, 2024.
U.S. replay number: 609-800-9909 International replay number: 800-770-2030 Conference ID: 4727212
About Bitcoin Depot
Bitcoin Depot Inc. (Nasdaq: BTM) was founded in 2016 with the mission to connect those who prefer to use cash to the broader, digital financial system. Bitcoin Depot provides its users with simple, efficient and intuitive means of converting cash into Bitcoin, which users can deploy in the payments, spending and investing space. Users can convert cash to bitcoin at Bitcoin Depot kiosks in 48 states and at thousands of name-brand retail locations in 29 states through its BDCheckout product. The Company has the largest market share in North America with approximately 8,000 kiosk locations as of July 1, 2024. Learn more at www.bitcoindepot.com.
This press release and any oral statements made in connection herewith include “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act of 1934, as amended. Forward-looking statements are any statements other than statements of historical fact, and include, but are not limited to, statements regarding the expectations of plans, business strategies, objectives and growth and anticipated financial and operational performance, including our growth strategy and ability to increase deployment of our products and services, our ability to strengthen our financial profile, and worldwide growth in the adoption and use of cryptocurrencies,. These forward-looking statements are based on management’s current beliefs, based on currently available information, as to the outcome and timing of future events. Forward-looking statements are often identified by words such as “anticipate,” “appears,” “approximately,” “believe,” “continue,” “could,” “designed,” “effect,” “estimate,” “evaluate,” “expect,” “forecast,” “goal,” “initiative,” “intend,” “may,” “objective,” “outlook,“ ”plan,“ ”potential,“ ”priorities,“ ”project,“ ”pursue,“ ”seek,“ ”should,“ ”target,“ ”when,“ ”will,“ ”would,” or the negative of any of those words or similar expressions that predict or indicate future events or trends or that are not statements of historical matters, although not all forward-looking statements contain such identifying words. In making these statements, we rely upon assumptions and analysis based on our experience and perception of historical trends, current conditions, and expected future developments, as well as other factors we consider appropriate under the circumstances. We believe these judgments are reasonable, but these statements are not guarantees of any future events or financial results. These forward-looking statements are provided for illustrative purposes only and are not intended to serve as, and must not be relied on by any investor as, a guarantee, an assurance, a prediction or a definitive statement of fact or probability. Actual events and circumstances are difficult or impossible to predict and will differ from assumptions. Many actual events and circumstances are beyond our control.
These forward-looking statements are subject to a number of risks and uncertainties, including changes in domestic and foreign business, market, financial, political and legal conditions; failure to realize the anticipated benefits of the business combination; risks relating to the uncertainty of our projected financial information; future global, regional or local economic and market conditions; the development, effects and enforcement of laws and regulations; our ability to manage future growth; our ability to develop new products and services, bring them to market in a timely manner and make enhancements to our platform; the effects of competition on our future business; our ability to issue equity or equity-linked securities; the outcome of any potential litigation, government and regulatory proceedings, investigations and inquiries; and those factors described or referenced in filings with the Securities and Exchange Commission. If any of these risks materialize or our assumptions prove incorrect, actual results could differ materially from the results implied by these forward-looking statements. There may be additional risks that we do not presently know or that we currently believe are immaterial that could also cause actual results to differ from those contained in the forward-looking statements. In addition, forward-looking statements reflect our expectations, plans or forecasts of future events and views as of the date of this press release. We anticipate that subsequent events and developments will cause our assessments to change.
We caution readers not to place undue reliance on forward-looking statements. Forward-looking statements speak only as of the date they are made, and we undertake no obligation to update publicly or otherwise revise any forward-looking statements, whether as a result of new information, future events, or other factors that affect the subject of these statements, except where we are expressly required to do so by law. All written and oral forward-looking statements attributable to us are expressly qualified in their entirety by this cautionary statement.
Key Points: – Political attention on cryptocurrency is growing, potentially influencing future regulations and market dynamics. -Trump and other politicians are making pro-crypto promises, but implementation challenges remain. – Investors should watch for policy shifts that could impact crypto markets and related investments.
As the 2024 U.S. presidential election looms, cryptocurrency has unexpectedly taken center stage, promising to reshape both the political and investment landscapes. The recent Bitcoin 2024 conference in Nashville served as a lightning rod for political attention, with figures from across the spectrum – most notably former President Donald Trump – making bold commitments to the crypto community.
Trump’s promises were sweeping: appointing a crypto Presidential Advisory Council, ousting SEC chair Gary Gensler, introducing crypto-friendly regulations, and even establishing a “strategic national bitcoin stockpile.” These pledges were echoed and amplified by other politicians, including Senator Cynthia Lummis and independent candidate Robert F. Kennedy Jr., who proposed acquiring up to 4 million bitcoins for a national reserve.
For investors, this surge in political interest signals potential seismic shifts in the regulatory environment. However, it’s crucial to approach these promises with a healthy dose of skepticism. Many proposed actions face significant legislative and legal hurdles, even in a favorable political climate.
The crypto industry’s growing political clout is evident in its fundraising prowess. FairShake, the largest crypto Super PAC, has amassed over $200 million, positioning itself as a formidable force in upcoming elections. This financial muscle could translate into increased lobbying power and potentially more favorable policies for the sector.
From an investment perspective, this political momentum could lead to several outcomes:
Regulatory Clarity: A pro-crypto administration could usher in clearer regulations, potentially reducing market uncertainty and attracting more institutional investors.
Market Volatility: Political developments will likely trigger significant price movements, creating both opportunities and risks for traders and investors.
Mainstream Adoption: Increased political legitimacy could accelerate crypto’s integration into traditional financial systems, opening new investment avenues.
Sectoral Impact: Companies in blockchain technology, cybersecurity, and fintech could see increased interest as crypto gains political traction.
Global Competition: A U.S. pivot towards crypto-friendly policies could influence global crypto regulations and investments.
Bitcoin’s price action following the conference – surging above $70,000 before retreating – underscores the market’s sensitivity to political developments. Year-to-date, Bitcoin has risen over 50%, buoyed by increased institutional interest following the launch of Bitcoin ETFs.
As the election approaches, savvy investors should monitor several key areas:
Proposed legislation affecting crypto regulations
Appointments to key regulatory positions, especially at the SEC and CFTC
Statements from major political figures on crypto policy
Progress on initiatives like a national bitcoin reserve
International reactions and policy shifts in response to U.S. developments
While political attention on crypto is growing, it’s important to note that widespread adoption and understanding remain limited. As Trump candidly observed, “most people have no idea what the hell it is.” This gap between political rhetoric and public comprehension presents both challenges and opportunities for investors.
For those considering crypto investments, a multifaceted approach is crucial:
Diversification: Balance crypto investments with traditional assets to manage risk.
Due Diligence: Thoroughly research projects and platforms before investing.
Regulatory Awareness: Stay informed about evolving regulations both domestically and internationally.
Technology Understanding: Grasp the underlying technology and its potential applications beyond currency.
Long-term Perspective: Consider the long-term potential of blockchain technology beyond short-term price fluctuations.
As the 2024 election unfolds, the interplay between politics, regulation, and crypto markets will likely intensify. For investors, this evolving landscape presents a unique set of opportunities and risks. Those who can navigate the complex intersection of technology, finance, and politics may find themselves well-positioned in this new frontier of investing.
Remember, while the potential for high returns exists, so too does the risk of significant losses. As always, it’s crucial to approach any investment, especially in the volatile crypto space, with caution and in alignment with one’s risk tolerance and financial goals.
Pioneering Bitcoin ATM Provider Continues Market Dominance and Accelerated Growth with the Largest Installed Fleet in Its History
ATLANTA, July 22, 2024 (GLOBE NEWSWIRE) — Bitcoin Depot Inc. (“Bitcoin Depot” or the “Company”) (NASDAQ: BTM), a U.S.-based Bitcoin ATM (“BTM”) operator and leading fintech company, today proudly announced that it has achieved and exceeded its ambitious goal of deploying over 8,000 Bitcoin ATMs five months ahead of schedule, with 8,180 kiosks. This milestone reinforces Bitcoin Depot’s abiding market dominance and showcases its rapid growth trajectory. The achievement solidifies the Company’s previously announced achievement of signing 8,000 locations and its year-end objective of having the largest installed fleet of BTMs in the Company’s history.
“Surpassing our deployment goal well ahead of schedule is a testament to the relentless dedication of our team and our strategic initiatives aimed at expanding Bitcoin’s accessibility,” said Bitcoin Depot CEO Brandon Mintz. “Building on the momentum we’ve already cultivated in the first half of 2024; we have no intention of slowing down as we gear up to provide even more customers with seamless access to the digital financial ecosystem. “
Bitcoin Depot’s aggressive expansion strategy has been a key driver of this achievement. In the first half of 2024, the Company not only secured contracts to exceed over 8,000 kiosk locations but also enhanced its operational footprint significantly.
Highlights of the company’s achievements year-to-date include:
Announced retail partnership announcements with leading national and regional convenience store brands, increasing accessibility and brand reach.
Expanded its BTM fleet by over 900 kiosks to support 2024 growth initiatives.
Advanced its profit-sharing program through kiosks sales and investments from Sopris Capital.
Adopted a Bitcoin treasury strategy to further align with its commitment to the digital financial ecosystem.
Bitcoin Depot’s ATMs offer a straightforward, quick, and convenient method for converting cash into Bitcoin. This empowers users to participate in the digital financial ecosystem, facilitating payments, transfers, remittances, online purchases, and investments.
Since becoming the largest BTM operator in North America in early 2022, Bitcoin Depot has maintained its market-leading position. Despite market volatility, the Company made history in 2023 by becoming the first BTM operator to go public on a major U.S. stock exchange. The Company and its leadership have earned recognition for their exceptional growth, including accolades from Forbes 30 Under 30, Deloitte’s 2023 Technology Fast 500, and the 2023 Inc. 5000.
About Bitcoin Depot Bitcoin Depot Inc. (Nasdaq: BTM) was founded in 2016 with the mission to connect those who prefer to use cash to the broader, digital financial system. Bitcoin Depot provides its users with simple, efficient and intuitive means of converting cash into Bitcoin, which users can deploy in the payments, spending and investing space. Users can convert cash to bitcoin at Bitcoin Depot kiosks in 48 states and at thousands of name-brand retail locations in 29 states through its BDCheckout product. The Company has the largest market share in North America with approximately 7,400 kiosk locations as of April 1, 2024. Learn more at www.bitcoindepot.com.
This press release and any oral statements made in connection herewith include “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act. Forward-looking statements are any statements other than statements of historical fact, and include, but are not limited to, statements regarding the expectations of plans, business strategies, objectives and growth and anticipated financial and operational performance, including our growth strategy and ability to increase deployment of our products and services, the anticipated effects of the Amendment, and the closing of the Preferred Sale. These forward-looking statements are based on management’s current beliefs, based on currently available information, as to the outcome and timing of future events. Forward-looking statements are often identified by words such as “anticipate,” “appears,” “approximately,” “believe,” “continue,” “could,” “designed,” “effect,” “estimate,” “evaluate,” “expect,” “forecast,” “goal,” “initiative,” “intend,” “may,” “objective,” “outlook,” “plan,” “potential,” “priorities,” “project,” “pursue,” “seek,” “should,” “target,” “when,” “will,” “would,” or the negative of any of those words or similar expressions that predict or indicate future events or trends or that are not statements of historical matters, although not all forward-looking statements contain such identifying words. In making these statements, we rely upon assumptions and analysis based on our experience and perception of historical trends, current conditions, and expected future developments, as well as other factors we consider appropriate under the circumstances. We believe these judgments are reasonable, but these statements are not guarantees of any future events or financial results. These forward-looking statements are provided for illustrative purposes only and are not intended to serve as, and must not be relied on by any investor as, a guarantee, an assurance, a prediction or a definitive statement of fact or probability. Actual events and circumstances are difficult or impossible to predict and will differ from assumptions. Many actual events and circumstances are beyond our control.
These forward-looking statements are subject to a number of risks and uncertainties, including changes in domestic and foreign business, market, financial, political and legal conditions; failure to realize the anticipated benefits of the business combination; future global, regional or local economic and market conditions; the development, effects and enforcement of laws and regulations; our ability to manage future growth; our ability to develop new products and services, bring them to market in a timely manner and make enhancements to our platform; the effects of competition on our future business; our ability to issue equity or equity-linked securities; the outcome of any potential litigation, government and regulatory proceedings, investigations and inquiries; and those factors described or referenced in filings with the Securities and Exchange Commission. If any of these risks materialize or our assumptions prove incorrect, actual results could differ materially from the results implied by these forward-looking statements. There may be additional risks that we do not presently know or that we currently believe are immaterial that could also cause actual results to differ from those contained in the forward-looking statements. In addition, forward-looking statements reflect our expectations, plans or forecasts of future events and views as of the date of this press release. We anticipate that subsequent events and developments will cause our assessments to change.
We caution readers not to place undue reliance on forward-looking statements. Forward-looking statements speak only as of the date they are made, and we undertake no obligation to update publicly or otherwise revise any forward-looking statements, whether as a result of new information, future events, or other factors that affect the subject of these statements, except where we are expressly required to do so by law. All written and oral forward-looking statements attributable to us are expressly qualified in their entirety by this cautionary statement.
Contacts:
Investors Cody Slach, Alex Kovtun Gateway Group, Inc. 949-574-3860 BTM@gateway-grp.com
Media Christina Lockwood, Brenlyn Motlagh, Ryan Deloney Gateway Group, Inc. 949-574-3860 BTM@gateway-grp.com
Underscores the Attractiveness of the Company’s Bold North American Expansion Strategy
ATLANTA, July 16, 2024 (GLOBE NEWSWIRE) — Bitcoin Depot (“Bitcoin Depot” or the “Company”) (NASDAQ: BTM), a U.S.-based Bitcoin ATM (“BTM”) operator and leading fintech company, today announced sale of 200 additional BTM kiosks to Sopris Capital (“Sopris”), a 20-year-old multi-strategy investment firm as part of the Company’s profit-sharing program.
Bitcoin Depot launched the program in 2023 to provide additional deployment opportunities to qualified partners as part of its North American expansion strategy. Today’s news follows the March announcement, where Sopris joined Bitcoin Depot’s profit-sharing program with the purchase of 50 kiosks. This program allows Sopris to leverage Bitcoin Depot`s operating expertise and receive a passive income stream from its Bitcoin ATMs.
“Our decision to purchase additional kiosks underscores the attractiveness of this investment opportunity, and the confidence we have in Bitcoin Depot’s strategy and growth potential,” said Andrew Paul, Founder and CEO of Sopris Capital. “As an owner of 250 kiosks and one of the Company’s independent shareholders, we believe Bitcoin Depot presents multiple ways to drive high returns on our capital.”
Bitcoin Depot’s profit-sharing program provides a comprehensive investment package, including kiosk use, operating software, shipping, installation, and ongoing support. It also offers a passive income stream with monthly profit splits, providing a direct financial benefit to the partner. By partnering with Bitcoin Depot, companies can leverage the Company’s expertise in BTM operations and its integration with BitAccess software, the leading software suite for Bitcoin ATM operations.
“We are thrilled to deepen our partnership with Sopris Capital,” said Bitcoin Depot CEO Brandon Mintz. “We believe their various investments in our platform and common shares over the past four months underscores their confidence in our strategy and growth potential.”
Bitcoin Depot’s products and services provide an intuitive, quick, and convenient process for converting cash into Bitcoin, giving users the ability to access the broader digital financial system, including using their Bitcoin for purposes of making payments, transfers, remittances, online purchases, and investments. To learn more about Bitcoin Depot’s profit share program, visit: https://bitcoindepot.com/profit-sharing-program/.
About Bitcoin Depot Bitcoin Depot Inc. (Nasdaq: BTM) was founded in 2016 with the mission to connect those who prefer to use cash to the broader, digital financial system. Bitcoin Depot provides its users with simple, efficient and intuitive means of converting cash into Bitcoin, which users can deploy in the payments, spending and investing space. Users can convert cash to bitcoin at Bitcoin Depot kiosks in 48 states and at thousands of name-brand retail locations in 29 states through its BDCheckout product. The Company has the largest market share in North America with approximately 7,400 kiosk locations as of April 1, 2024. Learn more at www.bitcoindepot.com.
This press release and any oral statements made in connection herewith include “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act. Forward-looking statements are any statements other than statements of historical fact, and include, but are not limited to, statements regarding the expectations of plans, business strategies, objectives and growth and anticipated financial and operational performance, including our growth strategy and ability to increase deployment of our products and services, the anticipated effects of the Amendment, and the closing of the Preferred Sale. These forward-looking statements are based on management’s current beliefs, based on currently available information, as to the outcome and timing of future events. Forward-looking statements are often identified by words such as “anticipate,” “appears,” “approximately,” “believe,” “continue,” “could,” “designed,” “effect,” “estimate,” “evaluate,” “expect,” “forecast,” “goal,” “initiative,” “intend,” “may,” “objective,” “outlook,” “plan,” “potential,” “priorities,” “project,” “pursue,” “seek,” “should,” “target,” “when,” “will,” “would,” or the negative of any of those words or similar expressions that predict or indicate future events or trends or that are not statements of historical matters, although not all forward-looking statements contain such identifying words. In making these statements, we rely upon assumptions and analysis based on our experience and perception of historical trends, current conditions, and expected future developments, as well as other factors we consider appropriate under the circumstances. We believe these judgments are reasonable, but these statements are not guarantees of any future events or financial results. These forward-looking statements are provided for illustrative purposes only and are not intended to serve as, and must not be relied on by any investor as, a guarantee, an assurance, a prediction or a definitive statement of fact or probability. Actual events and circumstances are difficult or impossible to predict and will differ from assumptions. Many actual events and circumstances are beyond our control.
These forward-looking statements are subject to a number of risks and uncertainties, including changes in domestic and foreign business, market, financial, political and legal conditions; failure to realize the anticipated benefits of the business combination; future global, regional or local economic and market conditions; the development, effects and enforcement of laws and regulations; our ability to manage future growth; our ability to develop new products and services, bring them to market in a timely manner and make enhancements to our platform; the effects of competition on our future business; our ability to issue equity or equity-linked securities; the outcome of any potential litigation, government and regulatory proceedings, investigations and inquiries; and those factors described or referenced in filings with the Securities and Exchange Commission. If any of these risks materialize or our assumptions prove incorrect, actual results could differ materially from the results implied by these forward-looking statements. There may be additional risks that we do not presently know or that we currently believe are immaterial that could also cause actual results to differ from those contained in the forward-looking statements. In addition, forward-looking statements reflect our expectations, plans or forecasts of future events and views as of the date of this press release. We anticipate that subsequent events and developments will cause our assessments to change. We caution readers not to place undue reliance on forward-looking statements. Forward-looking statements speak only as of the date they are made, and we undertake no obligation to update publicly or otherwise revise any forward-looking statements, whether as a result of new information, future events, or other factors that affect the subject of these statements, except where we are expressly required to do so by law. All written and oral forward-looking statements attributable to us are expressly qualified in their entirety by this cautionary statement.
Joe Gomes, CFA, Managing Director, Equity Research Analyst, Generalist , Noble Capital Markets, Inc.
Joshua Zoepfel, Research Associate, Noble Capital Markets, Inc.
Refer to the full report for the price target, fundamental analysis, and rating.
BTC Mining. Bit Digital produced 61.7 BTC during June, a 2.5% decrease from 63.3 in the previous month. The active hash rate was 2.57 EH/s versus 2.54 EH/s the prior month. We expect to see an increase in active hash rate in the second half of the year as the Company becomes more opportunistic in deploying efficient miners.
AI/ETH. The Company had 256 servers actively running, similar to last month, and earned an estimated $4.1 million of unaudited revenue from its anchor contract during the month. Approximately 17,184 ETH was actively staked as of June 30, 2024, flat with last month. Bit Digital earned 3.5% blended APY on its staked ETH, up from 3.1% last month.
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This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).
*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision.
Demonstrates the Company’s Confidence in the Future of Bitcoin by Strategically Allocating a Portion of Cash Reserves to BTC
ATLANTA, June 17, 2024 (GLOBE NEWSWIRE) — Bitcoin Depot (NASDAQ: BTM), a U.S.-based Bitcoin ATM (“BTM”) operator and leading fintech company, today announced it plans to allocate a portion of its cash reserves to Bitcoin (BTC). Any future purchases will be opportunistic in nature and will not interfere with cash needs to support the company’s multiple growth opportunities.
This shift in BTM’s treasury strategy follows Accounting Standards Update (ASU) 2023-08, which, among other things, allows companies to record gains held on cryptocurrencies. The ASU will apply to all entities with fiscal years beginning after December 15, 2024.
“Adopting Bitcoin as part of our treasury strategy underscores our long-standing belief in Bitcoin as a significant financial asset and a store of value,” said Brandon Mintz, CEO of Bitcoin Depot. “We have always believed in providing easy access to Bitcoin for everyone, and this move reaffirms our confidence in Bitcoin’s potential for growth and stability. Given the recent accounting standards update, it also allows our shareholders to benefit from future BTC appreciation.”
Bitcoin, as an asset, has demonstrated remarkable resilience and growth since its inception, achieving a market capitalization of over $1 trillion at its peak. Institutional adoption has surged, with numerous companies and even countries recognizing Bitcoin’s value proposition. The introduction of Bitcoin ETFs has further legitimized its standing in traditional financial markets, making it more accessible to a wider range of investors. By including Bitcoin in its treasury strategy, Bitcoin Depot aligns itself with other forward-thinking institutions that see cryptocurrency as a hedge against inflation and a strategic asset for future growth.
This news also marks the latest show of momentum for Bitcoin Depot, which holds the largest market BTM share in North America, with over 7,400 Bitcoin ATM locations. The announcement follows several recent milestones and expansions for the company, including its first partnership with a major grocery chain as well as the advancement of its newly launched profit share program in April 2024.
The company also recently surpassed its goal of signing 8,000 BTM locations ahead of schedule to achieve the largest installed fleet of locations in its history and announced expansions into new markets, including Puerto Rico and Australia.
About Bitcoin Depot Bitcoin Depot Inc. (Nasdaq: BTM) was founded in 2016 with the mission to connect those who prefer to use cash to the broader, digital financial system. Bitcoin Depot provides its users with simple, efficient and intuitive means of converting cash into Bitcoin, which users can deploy in the payments, spending and investing space. Users can convert cash to bitcoin at Bitcoin Depot kiosks in 48 states and at thousands of name-brand retail locations in 29 states through its BDCheckout product. The Company has the largest market share in North America, with approximately 7,400 kiosk locations as of April 1, 2024. Learn more at www.bitcoindepot.com.
Cautionary Note Regarding Forward-Looking Statements This press release and any oral statements made in connection herewith include “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act. Forward-looking statements are any statements other than statements of historical fact, and include, but are not limited to, statements regarding the expectations of plans, business strategies, objectives and growth and anticipated financial and operational performance, including our growth strategy and ability to increase deployment of our products and services, the anticipated effects of the Amendment, and the closing of the Preferred Sale. These forward-looking statements are based on management’s current beliefs, based on currently available information, as to the outcome and timing of future events. Forward-looking statements are often identified by words such as “anticipate,” “appears,” “approximately,” “believe,” “continue,” “could,” “designed,” “effect,” “estimate,” “evaluate,” “expect,” “forecast,” “goal,” “initiative,” “intend,” “may,” “objective,” “outlook,” “plan,” “potential,” “priorities,” “project,” “pursue,” “seek,” “should,” “target,” “when,” “will,” “would,” or the negative of any of those words or similar expressions that predict or indicate future events or trends or that are not statements of historical matters, although not all forward-looking statements contain such identifying words. In making these statements, we rely upon assumptions and analysis based on our experience and perception of historical trends, current conditions, and expected future developments, as well as other factors we consider appropriate under the circumstances. We believe these judgments are reasonable, but these statements are not guarantees of any future events or financial results. These forward-looking statements are provided for illustrative purposes only and are not intended to serve as, and must not be relied on by any investor as, a guarantee, an assurance, a prediction or a definitive statement of fact or probability. Actual events and circumstances are difficult or impossible to predict and will differ from assumptions. Many actual events and circumstances are beyond our control.
These forward-looking statements are subject to a number of risks and uncertainties, including changes in domestic and foreign business, market, financial, political and legal conditions; failure to realize the anticipated benefits of the business combination; future global, regional or local economic and market conditions; the development, effects and enforcement of laws and regulations; our ability to manage future growth; our ability to develop new products and services, bring them to market in a timely manner and make enhancements to our platform; the effects of competition on our future business; our ability to issue equity or equity-linked securities; the outcome of any potential litigation, government and regulatory proceedings, investigations and inquiries; and those factors described or referenced in filings with the Securities and Exchange Commission. If any of these risks materialize or our assumptions prove incorrect, actual results could differ materially from the results implied by these forward-looking statements. There may be additional risks that we do not presently know or that we currently believe are immaterial that could also cause actual results to differ from those contained in the forward-looking statements. In addition, forward-looking statements reflect our expectations, plans or forecasts of future events and views as of the date of this press release. We anticipate that subsequent events and developments will cause our assessments to change.
We caution readers not to place undue reliance on forward-looking statements. Forward-looking statements speak only as of the date they are made, and we undertake no obligation to update publicly or otherwise revise any forward-looking statements, whether as a result of new information, future events, or other factors that affect the subject of these statements, except where we are expressly required to do so by law. All written and oral forward-looking statements attributable to us are expressly qualified in their entirety by this cautionary statement.
Robinhood Markets is making its biggest bet yet on the booming crypto market. The popular trading platform announced a deal to acquire Bitstamp, one of the world’s oldest and largest cryptocurrency exchanges, for approximately $200 million in cash.
The blockbuster transaction represents Robinhood’s largest acquisition to date and a major escalation of its push into the digital assets space. By bringing Bitstamp’s established crypto exchange capabilities in-house, Robinhood is positioning itself to become a fierce competitor to industry giants like Binance and Coinbase.
Founded in 2011, Bitstamp has emerged as a leading crypto exchange particularly popular among European and Asian traders. Its core spot trading platform offers a deep pool of liquidity with over 85 digital assets available for trading. Critically, Bitstamp also holds around 50 operational licenses and registrations across the globe.
For the fast-growing Robinhood Crypto division, acquiring Bitstamp provides an immediate expansion of its product lineup and geographic reach. The deal comes as Robinhood’s crypto business is already experiencing explosive growth. In the first quarter of 2024, crypto revenues drove a massive earnings beat, underscoring the intense customer demand. However, the company is also facing headwinds from U.S. regulators.
Just last month, Robinhood disclosed that it received a Wells Notice from the Securities and Exchange Commission regarding its crypto trading practices. The SEC has staked out an aggressive position that many digital assets should be classified and registered as securities. In contrast, Robinhood and other major crypto firms have pushed back against what they view as regulatory overreach by the SEC into the crypto markets. Despite the legal turbulence, Robinhood intends to keep communicating with regulators as it moves forward with the integration of Bitstamp.
Analysts view Robinhood’s big crypto bet as ultimately positioning the company for further growth. The Bitstamp deal supercharges its global crypto capabilities at a time when adoption of bitcoin, ether and other digital assets is rapidly accelerating worldwide. An analyst stated the acquisition fits squarely with Robinhood’s crypto-first strategy and could be a game-changer, immediately making them a major player worldwide. The analyst reiterated a Buy rating and $15 price target on the stock.
Indeed, Robinhood’s shares spiked over 3% in pre-market trading as investors cheered the transformative deal. The stock has already surged 69% so far this year amid the company’s renewed focus on profitable growth after cost-cutting measures.
While the $200 million price tag is just a drop in the bucket for Robinhood’s over $6 billion war chest of cash reserves, the acquisition symbolizes its all-in embrace of crypto. By combining Bitstamp’s battle-tested exchange with its own fast-growing retail crypto platform, Robinhood is positioning itself for a major shake-up of crypto trading.
The deal is expected to close in the first half of 2025, pending any additional regulatory hurdles. But one thing is clear – Robinhood has gone full-crypto, and its fight for dominance in this rapidly evolving space is only just beginning.
In a bold move that could significantly reshape the cryptocurrency mining industry, Riot Platforms Inc. has made an unsolicited offer to acquire rival Bitcoin miner Bitfarms Ltd. for $950 million. This acquisition bid, which includes both cash and stock, values Bitfarms at $2.30 per share, a 20% premium over its pre-offer trading price. Riot’s aggressive strategy is driven by recent industry dynamics and Bitfarms’ internal challenges, and it has the potential to profoundly impact the Bitcoin mining landscape.
Riot Platforms, already a major player in the Bitcoin mining sector, has taken a 9.25% stake in Bitfarms, making it the largest shareholder. This move follows Bitfarms’ management turmoil, including the firing of interim CEO Geoffrey Morphy, who is now suing the company for $27 million in damages. Riot’s initial offer, made on April 22, was rejected by Bitfarms’ board without substantive dialogue. Undeterred, Riot plans to call a shareholder meeting to appoint new independent directors, signaling a clear intention to influence Bitfarms’ strategic direction.
The proposed acquisition highlights a significant trend in the Bitcoin mining sector: consolidation. This trend has been accelerated by the recent Bitcoin “halving,” an event that occurs approximately every four years and cuts the rewards miners receive for validating transactions by 50%. This reduction in rewards tightens margins and pushes miners to either scale operations or seek consolidation to maintain profitability.
For Riot, absorbing Bitfarms would create the largest Bitcoin miner globally, based on projected computing power growth. This expansion would significantly enhance Riot’s Bitcoin production capabilities, positioning it alongside industry giants like Marathon Digital Holdings Inc. and CleanSpark Inc. The increased scale and capacity would provide Riot with greater negotiating power, more efficient operations, and improved resilience against market fluctuations and rising energy costs.
Riot’s pursuit of Bitfarms sends a clear message to other players in the Bitcoin mining space: scale is essential for survival and success in the post-halving era. Smaller miners, already struggling with reduced revenues and limited access to capital, may find it increasingly challenging to compete against larger, resource-rich companies. This could trigger a wave of mergers and acquisitions as miners seek to consolidate resources, optimize operations, and leverage economies of scale.
For instance, Bitcoin miner Stronghold Digital Mining Inc. is already exploring strategic alternatives, including a potential sale. As the industry adapts to the new economic realities imposed by the halving, more companies might follow suit, either by seeking mergers or becoming acquisition targets themselves.
The consolidation trend among Bitcoin miners has broader implications for the cryptocurrency industry. Firstly, it could lead to increased centralization of mining power, potentially raising concerns about the decentralization ethos of Bitcoin. However, it could also result in more efficient and stable mining operations, reducing the risk of disruptions and enhancing the overall security and reliability of the Bitcoin network.
Moreover, large-scale miners like Riot, with significant resources and capacity, are better positioned to adopt sustainable practices and negotiate favorable energy contracts, potentially addressing some of the environmental criticisms faced by the industry.
Riot Platforms’ bid to acquire Bitfarms marks a pivotal moment in the evolution of Bitcoin mining. This strategic move underscores the importance of scale in navigating the post-halving landscape and sets the stage for further consolidation in the industry. For investors and stakeholders in the cryptocurrency space, this development highlights the dynamic and competitive nature of Bitcoin mining, where agility, resources, and strategic vision are key to thriving in an ever-evolving market. As the industry continues to mature, the actions of major players like Riot will undoubtedly shape the future of cryptocurrency mining and its role within the broader financial ecosystem.
