Tag: Cryptocurrency

Robinhood Doubles Down on Crypto With $200M Bitstamp Buyout

Posted on by slightbourne@noblecapitalmarkets.com

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.

Core Scientific Enters AI Compute Market with $3.5B Deal

Posted on by slightbourne@noblecapitalmarkets.com

In a significant development in the high-performance computing (HPC) space, Core Scientific, a leading digital infrastructure provider for bitcoin mining and hosting services, has announced a landmark deal with CoreWeave, an AI hyperscaler. The 12-year agreement will see Core Scientific deliver approximately 200 megawatts of infrastructure to host CoreWeave’s high-performance compute operations, positioning the company as a major player in the AI data center space.

This strategic move marks a significant expansion of Core Scientific’s hosting business and earnings power, while maintaining its strong bitcoin mining franchise. The deal is expected to generate over $3.5 billion in cumulative revenue for Core Scientific during the initial contract terms, with estimated average annual revenue of $290 million. This development highlights the growing importance of HPC in the tech industry and the opportunities it presents for emerging growth companies.

The Rise of High-Performance Computing

HPC is a critical component in various industries, including AI, scientific research, and cryptocurrency mining. The increasing demand for powerful computing capabilities has led to a surge in the adoption of HPC solutions. Core Scientific’s agreement with CoreWeave demonstrates the company’s commitment to meeting this growing demand and diversifying its business model.

AI Computing: A Key Driver of Growth

AI computing is a significant driver of the HPC market, with applications in various sectors, including healthcare, finance, and technology. The increasing adoption of AI solutions has led to a rise in demand for high-performance computing infrastructure. CoreWeave’s partnership with Core Scientific will enable the company to expand its AI compute capabilities, further solidifying its position in the AI hyperscale space.

Bitcoin Mining and HPC: A Synergistic Relationship

Core Scientific’s roots in bitcoin mining have provided a natural segue into HPC. The company’s existing infrastructure and expertise in high-power computing have enabled it to expand into the HPC space seamlessly. This synergistic relationship between bitcoin mining and HPC presents opportunities for companies like Core Scientific to leverage their existing infrastructure and expertise to tap into the growing HPC market.

Opportunities for Emerging Growth Companies

The HPC space presents significant opportunities for emerging growth companies. As demand for high-performance computing continues to outpace supply, companies like Core Scientific are well-positioned to meet customer needs with a much shorter time to power than greenfield data center projects. This deal demonstrates how small-cap companies can leverage their existing infrastructure and expertise to tap into the growing HPC market, providing a pathway for growth and expansion.

Investment Opportunities in the HPC Space

The HPC space offers attractive investment opportunities for investors seeking exposure to emerging growth companies. As the demand for high-performance computing continues to grow, companies like Core Scientific are poised to benefit from this trend. Investors can capitalize on this growth by investing in companies that are well-positioned to meet the increasing demand for HPC solutions.

In conclusion, Core Scientific’s strategic move into the AI compute space highlights the growing importance of HPC in the tech industry. This deal demonstrates the opportunities available for emerging growth companies in the HPC space and the potential for investors to capitalize on this growth. As the demand for high-performance computing continues to rise, companies like Core Scientific are poised to benefit from this trend, making them attractive investment opportunities for investors seeking exposure to the HPC space.

Bitcoin Mining Showdown: Riot Platforms’ Power Play for Bitfarms

Posted on by slightbourne@noblecapitalmarkets.com

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.

Take a moment to take a look at Bit Digital, a large-scale bitcoin mining business with operations across the U.S. and Canada.

Ether ETFs Get Green Light, Ushering In New Era for Crypto Investing

Posted on by slightbourne@noblecapitalmarkets.com

The crypto world was abuzz this week as the U.S. Securities and Exchange Commission (SEC) gave the green light for the launch of exchange-traded funds (ETFs) that will track the price of ether, the cryptocurrency powering the Ethereum blockchain.

In a little-noticed release on Thursday evening, the SEC approved a rule change by the Chicago Board Options Exchange (CBOE) that effectively opens the door for ether ETFs to be listed and traded just like their bitcoin counterparts.

This landmark decision represents a major milestone for the crypto industry’s evolution into mainstream finance. It grants ether, after years of regulatory ambiguity, a legitimacy akin to that bestowed upon bitcoin last year when the first bitcoin ETFs hit the market.

“This is a huge development that really drives home ether’s commodity status from a regulatory perspective,” said Rachel Lin, CEO of crypto derivatives platform SynFutures. “It will allow investors, from retail to institutional, to gain exposure to ether through a regulated, familiar investment vehicle.”

Ether is the second-largest cryptocurrency after bitcoin with a market cap of around $220 billion. It has rapidly emerged as a crucial piece of infrastructure undergirding large swaths of crypto and blockchain applications beyond just a medium of exchange.

The Ethereum network hosts a multitude of decentralized apps and services, including large stablecoin ecosystems, decentralized finance (DeFi) platforms for lending/borrowing, and a rapidly expanding universe of blockchain-based games and metaverse projects. All these rely on ether as the “gas” that powers the network.

Major crypto companies quickly celebrated the ruling as catalyzing new growth for the ecosystem. “This approval from the SEC will allow millions of investors to embrace crypto in a familiar, regulated way,” said David Puth, CEO of cryptocurrency exchange CoinX.

The decision paves the way for asset managers to launch ether ETFs that directly hold the cryptocurrency, similar to existing bitcoin offerings like the Bitcoin ETF. This could drive significant new investment into ether from both institutional players seeking crypto exposure without holding the underlying asset, as well as retail investors who want a simple ether investment product available in traditional brokerage accounts.

However, some key questions remain around which specific ETF proposals will get approved, when they might begin trading, and whether they will be physically-backed with actual ether or employ indirect exposure through derivatives.

Leading ETF issuers like BlackRock, Fidelity, and WisdomTree have active filings for ether ETFs that could get a look. But smaller players like Cathie Wood’s Ark Invest were among the first movers on bitcoin ETF filings and could be better positioned for any initial ether product launches as well.

While the ether ETFs have a regulatory greenlight, they will still need to be approved on an individual basis by the SEC and the exchanges they list on. Industry analysts expect a speedy process, with the first launch potentially coming in the next few months.

For ether investors who have waited years for this moment, simple and convenient access to the world’s most actively utilized crypto network through traditional market infrastructure is almost at hand. The launch of ether ETFs may turbocharge investment into the Ethereum ecosystem – and accelerate the momentum behind crypto’s move into mainstream finance.

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Release – Bit Digital, Inc. Announces First Quarter of Fiscal Year 2024 Financial Results

Posted on by dburczyk@noblecapitalmarkets.com

Research News and Market Data on BTBT

NEW YORK, May 15, 2024 /PRNewswire/ — Bit Digital, Inc. (Nasdaq: BTBT) (the “Company”), a sustainable platform for digital assets and artificial intelligence (“AI”) infrastructure headquartered in New York City, today announced its unaudited financial results for the First Quarter ended March 31, 2024. 

Financial Highlights for the First Quarter of 2024

  • Total revenue was $30.3 million for the First Quarter of 2024, a 266% increase compared to the First Quarter of 2023. The increase was primarily driven by the commencement of our Bit Digital AI business and by a higher realized bitcoin price.
  • Revenue from bitcoin mining was $21.9 million for the First Quarter of 2024, a 166% increase compared to the prior year’s quarter. The Company’s Bit Digital AI business, referred to as High performance computing services (“HPC”), began generating revenue in January 2024, and recognized $8.1 million of revenue during the quarter. The Company issued a one-time service credit of $1.3 million to its HPC customer as compensation for decreased utilization during the initial deployment period, which included testing and optimization phases. Illustratively, adding back this credit would yield pro forma gross margins of approximately 72% on a net basis compared to reported gross margins of 61% for the segment. Revenue from ETH staking was approximately $0.3 million.
  • The Company had cash, cash equivalents and restricted cash of $35.5 million, and total liquidity (defined as cash equivalents and restricted cash, USDC, and the fair market value of digital assets) of approximately $163.21 million, as of March 31, 2024.
  • Total assets were $291.1 million and Shareholders’ Equity amounted to $265.2 million as of March 31, 2024.
  • Adjusted EBITDA2 was $58.5 million for the First Quarter of 2024 compared to $1.5 million for the First Quarter of 2023.
  • GAAP earnings per share was $0.43 on a fully-diluted basis for the First Quarter of 2024 compared to a loss of $0.03 for the First Quarter of 2023.

Operational Highlights for the First Quarter 2024

  • The Company earned 410.7 bitcoins during the First Quarter of 2024, a 13% increase from the prior year. Growth was primarily driven by a higher active hash rate and partially offset by an increase in network difficulty.
  • The Company paid approximately $0.05 per kilowatt hour to its hosting partners for electricity consumed during the First Quarter of 2024.
  • The average fleet efficiency for the active fleet was approximately 28.3 J/TH as of March 31, 2024.
  • The Company earned 111.1 ETH in native staking and 1.3 ETH in liquid staking, respectively, in the First Quarter of 2024.
  • Treasury holdings of BTC and ETH were 956.4 and 16,031.43, respectively, with a fair market value of approximately $68.2 million and $58.5 million on March 31, 2024, respectively.
  • The BTC equivalent4 of our digital asset holdings as of March 31, 2024 (defined as if all ETH and USDC holdings were converted into BTC as of that date) was approximately 1,790.0 BTC5, or approximately $127.7 million.
  • As of March 31, 2024, we had 48,898 miners owned or operating (in Iceland) for bitcoin mining with a total maximum hash rate of 4.2 EH/S.
  • The Company’s active hash rate of its bitcoin mining fleet was approximately 2.76 EH/s as of March 31, 2024.
  • The Company purchased approximately 2,350 bitcoin mining units during the First Quarter of 2024.
  • Approximately 85% of our fleet’s run-rate electricity consumption was generated from carbon-free energy sources as of March 31, 2024. These figures are based on data provided by our hosts, publicly available sources, and internal estimates, demonstrating our commitment to sustainable practices in the digital asset mining industry.
  • The Company had approximately 3,008 ETH actively staked in native staking protocols as of March 31, 2024. The decrease relative to the prior quarter was due to the Company changing its provider for native staking solutions. As of April 30, 2024, the Company had approximately 17,184 ETH actively staked in native staking protocols.
  • On January 22, 2024, approximately 192 servers (1,536 GPUs) began generating revenue from the Company’s AI customer contract. Subsequently, approximately 64 additional servers (512 GPUs) commenced revenue generation on February 2, 2024.
  • On January 26, 2024, the Company finalized an agreement with Coinmint for up to 6 MW of additional mining capacity at Coinmint’s hosting facility in Massena, New York. This new agreement brings the Company’s total contracted hosting capacity with Coinmint to approximately 46 MW.

Management Commentary

“Our First Quarter 2024 results represent a strong start to the year with revenue growing by more than 250% and GAAP Net Income in excess of $50 million. The primary drivers for the improved performance were the commencement of our Bit Digital AI business and a higher realized bitcoin price.

We were well prepared for the halving which occurred in April 2024. Our balance sheet remains a core strength with over $160 million of total liquidity as of March 31, 2024, zero debt, and a growing revenue stream that is not correlated to the economics of bitcoin mining. While we continue to evaluate the post-halving bitcoin mining landscape, our goal of reaching 6.0 EH/s this year remains intact. We are actively engaged in discussions for both incremental hosting opportunities and potential acquisitions.

We continue to believe that capital allocation optionality provided by our complementary business lines is a key differentiator for our Company. We are actively evaluating a number of growth opportunities, both organic and inorganic, across each of our business lines. We are in the late stages of finalizing an agreement to double the size of the GPU fleet for our anchor client and our negotiations with prospective clients are progressing well. Our target of reaching a $100 million annualized revenue run-rate by year-end for this segment remains intact.”

About Bit Digital

Bit Digital, Inc. is a sustainable platform for digital assets and artificial intelligence (“AI”) infrastructure headquartered in New York City. Our bitcoin mining operations are located in the US, Canada, and Iceland. The Company has established a business line, Bit Digital AI, that offers infrastructure services for artificial intelligence applications.  For additional information, please contact ir@bit-digital.com or visit our website at www.bit-digital.com.

Investor Notice 

Investing in our securities involves a high degree of risk. Before making an investment decision, you should carefully consider the risks, uncertainties and forward-looking statements described under “Risk Factors” in Item 3.D of our Annual Report on Form 20-F for the fiscal year ended December 31, 2023. If any material risk was to occur, our business, financial condition or results of operations would likely suffer. In that event, the value of our securities could decline and you could lose part or all of your investment. The risks and uncertainties we describe are not the only ones facing us. Additional risks not presently known to us or that we currently deem immaterial may also impair our business operations. In addition, our past financial performance may not be a reliable indicator of future performance, and historical trends should not be used to anticipate results in the future. Future changes in the network-wide mining difficulty rate or bitcoin hash rate may also materially affect the future performance of Bit Digital’s production of bitcoin. Actual operating results will vary depending on many factors including network difficulty rate, total hash rate of the network, the operations of our facilities, the status of our miners, and other factors. See “Safe Harbor Statement” below.

Safe Harbor Statement 

This press release may contain certain “forward-looking statements” relating to the business of Bit Digital, Inc., and its subsidiary companies. All statements, other than statements of historical fact included herein are “forward-looking statements.” These forward-looking statements are often identified by the use of forward-looking terminology such as “believes,” “expects,” or similar expressions, involving known and unknown risks and uncertainties. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable, they do involve assumptions, risks and uncertainties, and these expectations may prove to be incorrect. Investors should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. The Company’s actual results could differ materially from those anticipated in these forward-looking statements as a result of a variety of factors, including those discussed in the Company’s periodic reports that are filed with the Securities and Exchange Commission and available on its website at http://www.sec.gov. All forward-looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by these factors. Other than as required under the securities laws, the Company does not assume a duty to update these forward-looking statements.

Footnotes:

1 This figure excludes approximately 2,701 ETH that were transferred to an internally managed fund.

2 Adjusted EBITDA refers to earnings before interest expense, income tax expense and depreciation and amortization expense (“EBITDA”) adjusted to eliminate the effects of certain non-cash and / or non-recurring items.

3 This figure excludes approximately 2,701 ETH that were transferred to an internally managed fund.

4 “BTC equivalent” is a hypothetical illustration of the value of our digital asset portfolio in bitcoin terms. BTC equivalent is defined as if all non-BTC digital assets, comprised of ETH and USDC, were converted into BTC as of March 31, 2024, and added to our existing BTC balance. Conversion values are found using the closing price on coinmarketcap.com.

5 This figure excludes approximately 2,701 ETH that were transferred to an internally managed fund.

FTX Bankruptcy Plan Aims to Repay Most Customers in Full, Plus Interest

Posted on by slightbourne@noblecapitalmarkets.com

In a remarkable turn of events, the collapsed cryptocurrency exchange FTX has proposed a bankruptcy reorganization plan that could see nearly all of its customers fully repaid for their lost funds – and then some. According to a court filing released on Wednesday, FTX estimates it owes creditors around $11.2 billion, but has managed to recover between $14.5 billion and $16.3 billion to distribute.

The proposed plan states that customers whose claims amount to $50,000 or less, which accounts for around 98% of FTX’s creditors, will receive approximately 118% of their allowed claim amount. This means these customers would get all of their money back, plus an additional 18% payout on top.

This development comes as an incredible lifeline for the many retail investors and traders who had their funds frozen when FTX collapsed into bankruptcy in November 2022 amid fraud allegations against its founder Sam Bankman-Fried. At the time, new CEO John Ray III bluntly stated it was one of the most catastrophic corporate failures he’d seen in 40 years of restructuring experience.

So how did FTX manage to raise over $14 billion to repay creditors after such a spectacular implosion? The answer lies in a series of strategic asset sales and recovering investments made by the exchange and Bankman-Fried’s hedge fund Alameda Research.

One of the biggest windfalls came from selling most of FTX’s stake in artificial intelligence company Anthropic, which is backed by Amazon. That divestment alone netted FTX close to $900 million. The exchange also monetized various other venture investments and digital asset holdings.

However, FTX faced a significant hurdle – a large sum of cryptocurrency that went simply missing from the exchange after its bankruptcy. This denied them the ability to benefit from the massive price appreciation that leading cryptocurrencies like Bitcoin have seen since November, which is up over 270%.

As John Ray III noted, the company had to “look to other sources of recoverable value to repay creditors” beyond just holding crypto assets. Their aggressive asset sales and recovery efforts seem to have paid off.

While undoubtedly positive news for FTX’s customers, the proposed bankruptcy plan still requires approval from the court overseeing the case. The plan release also reminded that Sam Bankman-Fried was convicted on seven criminal counts related to FTX’s collapse and received a 25-year prison sentence.

If approved, the FTX bankruptcy would represent one of the most successful cryptocurrency exchange restructurings to date in terms of customer reimbursement. It’s a glimmer of hope amidst an industry still reeling from a crisis of consumer confidence following FTX and other high-profile blowups in 2022.

Of course, repayment is just one step in FTX’s long road to reorganization. Serious questions remain around tightening regulatory oversight and restoring trust in centralized crypto trading platforms. But for its customers at least, this plan could provide closure and make them remarkably whole after a near-total wipeout.

Release – Bit Digital, Inc. Announces Monthly Production Update for April 2024

Posted on by dburczyk@noblecapitalmarkets.com

Research News and Market Data on BTBT

NEW YORK, May 6, 2024 /PRNewswire/ — Bit Digital, Inc. (Nasdaq: BTBT) (“Bit Digital” or the “Company”), a sustainable platform for digital assets and artificial intelligence (“AI”) infrastructure headquartered in New York, announced its unaudited digital asset production and corporate updates for the month of April 2024.

Corporate Highlights for April 2024

  • In April 2024, the Company produced 119.3 BTC, a 12.5% decrease compared to the prior month. The decrease relative to the prior month was predominantly due to the reduction of bitcoin block rewards post-halving.
  • The Company’s active hash rate was approximately 2.76 EH/s as of April 30, 2024.
  • Treasury holdings1 of BTC and ETH were 992.4 and 20,241.7 with a fair market value of approximately $60.2 million and $61.0 million, respectively, on April 30, 2024.
  • The BTC equivalent2 of our digital asset holdings as of April 30, 2024, was approximately 2,010.1 or approximately $121.9 million.
  • The Company had cash and cash equivalents of $43.7 million as of April 30, 2024.

Bit Digital AI Update

  • As of April 30, 2024, the Company had 251 servers actively generating revenue from its initial Bit Digital AI contract. The Company earned an estimated $4.1 million of unaudited revenue from this contract during the month of April 2024.

Proof-of-Stake Highlights

  • The Company had approximately 17,184 ETH actively staked in native staking protocols as of April 30, 2024.
  • Bit Digital earned a blended APY of approximately 1.0% on its staked ETH position for the month of April 2024. The decrease in yield was due to the lag time in redeploying its staked ETH after changing its provider for native staking solutions.
  • The Company earned aggregate staking rewards of approximately 13.9 ETH during April 2024.

About Bit Digital

Bit Digital, Inc. is a sustainable platform for digital assets and artificial intelligence (“AI”) infrastructure headquartered in New York City. Our bitcoin mining operations are located in the US, Canada, and Iceland. The Company has established a business line, Bit Digital AI, that offers specialized cloud-infrastructure services for artificial intelligence applications.  For additional information, please contact ir@bit-digital.com or visit our website at www.bit-digital.com.

Investor Notice 

Investing in our securities involves a high degree of risk. Before making an investment decision, you should carefully consider the risks, uncertainties and forward-looking statements described under “Risk Factors” in Item 3.D of our most recent Annual Report on Form 20-F for the fiscal year ended December 31, 2023. If any material risk was to occur, our business, financial condition or results of operations would likely suffer. In that event, the value of our securities could decline and you could lose part or all of your investment. The risks and uncertainties we describe are not the only ones facing us. Additional risks not presently known to us or that we currently deem immaterial may also impair our business operations. In addition, our past financial performance may not be a reliable indicator of future performance, and historical trends should not be used to anticipate results in the future. Future changes in the network-wide mining difficulty rate or bitcoin hash rate may also materially affect the future performance of Bit Digital’s production of bitcoin. Actual operating results will vary depending on many factors including network difficulty rate, total hash rate of the network, the operations of our facilities, the status of our miners, and other factors.

Safe Harbor Statement 

This press release may contain certain “forward-looking statements” relating to the business of Bit Digital, Inc., and its subsidiary companies. All statements, other than statements of historical fact included herein are “forward-looking statements.” These forward-looking statements are often identified by the use of forward-looking terminology such as “believes,” “expects,” or similar expressions, involving known and unknown risks and uncertainties. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable, they do involve assumptions, risks and uncertainties, and these expectations may prove to be incorrect. Investors should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. The Company’s actual results could differ materially from those anticipated in these forward-looking statements as a result of a variety of factors, including those discussed in the Company’s periodic reports that are filed with the Securities and Exchange Commission and available on its website at http://www.sec.gov. All forward-looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by these factors. Other than as required under the securities laws, the Company does not assume a duty to update these forward-looking statements.

Footnotes:

1 “Treasury holdings” excludes approximately 2,701 ETH that were transferred to an internally managed fund.

2 “BTC equivalent” is a hypothetical illustration of the value of our digital asset portfolio in bitcoin terms. BTC equivalent is defined as if all non-BTC digital assets, comprised of ETH, and USDC, were converted into BTC as of April 30, 2024, and added to our existing BTC balance. Conversion values are found using the closing price on coinmarketcap.com.

Bitcoin’s Next Major Milestone Is A Few Days Away: The 2024 Halving

Posted on by slightbourne@noblecapitalmarkets.com

A once-every-four-years event in the Bitcoin world is rapidly approaching – the highly anticipated “halving.” Scheduled to occur around April 19th, 2024, this mechanism hard-coded into Bitcoin’s DNA is set to cut the rate of new BTC issuance in half. It’s a pivotal moment that could supercharge the crypto’s scintillating 2024 rally and reignite the bull market.

The halving is a deflationary feature designed to control Bitcoin’s supply over time by reducing the block reward paid to miners. From its inception in 2009 until 2012, miners received 50 BTC per validated block. That number was cut in half to 25 BTC at the first halving in 2012, then halved again to 12.5 BTC in 2016, and most recently to 6.25 BTC in 2020.

Now in 2024, the block reward is set to get cut again from 6.25 to around 3.125 BTC. By systematically slowing the issuance rate over time, Bitcoin’s supply is kept scarce in the face of theoretically increasing demand. This perceived scarcity is one of the factors purported to give Bitcoin its monetary value premium as a form of “digital gold.”

The halving events have historically preceded huge price surges in Bitcoin. A year after the May 2020 halving, Bitcoin rallied over 545%. Similar explosive rallies were witnessed after the 2016 and 2012 events as well. The logic is that as new supply slows after the halving, demand has to be higher to sustain price levels.

Some analysts think the halving impact has already been priced into Bitcoin’s blistering 2024 rally amid optimism around newly launched U.S. Bitcoin ETFs and rising institutional adoption. Since January 1st, BTC has surged over 60% to fresh all-time highs near $74,000.

But many Bitcoin veterans believe the halving could simply be the catalyst that reignites the next true crypto bull cycle akin to cycles past. They point to the recent rally as just the warm-up act before the main event. Adding fuel to the fire, the Federal Reserve is expected to cut interest rates later this year, thereby boosting risk assets like Bitcoin.

According to crypto exchange Bitfinex, Bitcoin could rally 160% in the 12-14 months post-halving to over $150,000 per coin if historical trends play out. While past returns are no guarantee of future performance, the scarcity effects of reduced supply could indeed supercharge demand.

Of course, doubters remain plentiful. There’s the argument that three prior data points create a small sample size from which to draw conclusions. The 2020 cycle was potentially inflated by pandemic stay-at-home narratives. And as Bitcoin matures, price movements may become more decoupled from fundamentals like the halving.

For crypto diehards though, the halving represents a once-in-a-cycle opportunity to get positioned ahead of the next major uptrend in Bitcoin prices. After spending 2022 and much of 2023 brutalized by the brutal crypto winter, many view it as the light at the end of the tunnel. Whether it marks just another bullish catalyst or something even bigger remains to be seen. But Bitcoin’s next milestone moment is fast approaching.

New Highs Across Markets Signal Bull Run For Investors

Posted on by slightbourne@noblecapitalmarkets.com

The stock market is heating up and signaling the return of the bulls, as evidenced by fresh all-time highs in the S&P 500 and a rally across risk assets like Bitcoin and gold. Fueled by booming innovation in artificial intelligence, speculative capital is flowing back into equities in a big way. For investors, it may be time to go hunting for the next big investments.

The S&P 500 broke out to new records this week, finally surpassing the previous highs set back in January 2022 before last year’s punishing bear market. The large-cap index closed at 5233 on Thursday, up over 28% year-to-date. This demonstrates that the decade-plus bull run that began after the 2008 financial crisis may have refreshed legs under it.

The strength comes as AI mania has gripped Wall Street and Main Street. The smash success of OpenAI’s ChatGPT triggered a cascade of investors plowing capital into AI startups and tech giants racing to deploy advanced language models and machine learning systems. Cathie Wood’s Ark Invest funds, which load up on disruptive innovation plays, have surged over 30% in 2023.

Even the traditionally cautious money managers are piling in. Just this week, e-commerce juggernaut Amazon announced a staggering $4 billion investment into AI research firm Anthropic. It shows the FANG giants remain at the vanguard of cutting-edge tech adoption and are more than willing to spend big to stay ahead of the curve.

The AI buzz has spurred a speculative frenzy not seen since the meme stock and SPAC manias of 2021. The heavy inflows, plus robust economic data, have pushed U.S. stock indexes to their most overbought levels since the rally out of the pandemic lows. Technical indicators suggest more volatility and pullbacks could be in store, but the trend remains firmly bullish for now.

The buying spree has spilled over into other risk assets like cryptocurrencies and gold. Bitcoin soared above $70,000 recently to its highest levels ever. The original crypto has rallied over 70% in 2023 as institutions warm back up to the space and the AI buzz rekindles visions of decentralized Web3 applications and business models.

Not to be outdone, gold has surpassed $2,200 per ounce and is trading at levels far greater than what was seen in 2020 during the pandemic turmoil. Bullion is benefiting from growing concerns over persistent inflation and fears the Federal Reserve could push the economy into recession as it keeps raising interest rates aggressively. The yellow metal is increasingly seen as a haven in times of economic and banking system stress.

Combined, the advancing prices and frothy trading action point to the return of the animal spirits last seen at the height of the Robinhood/Reddit meme stock craze from two years ago. Caution is certainly warranted, as downside risk remains with growing chances of an economic hard landing from the Fed’s inflation fight.

But the market often climbs a wall of worry, and the blowout action indicates speculators are back in full force. For investors able to navigate the volatility, this may be an ideal time to put capital to work and research the next big opportunities to ride the bull’s coattails.

As ARK’s Cathie Wood stated, “Given the breakthroughs in AI broadly, we believe we are living in the most profound period of commercial invention ever.” Profound invention tends to create extreme investment returns for those with the foresight to invest early in transformative technologies.

For investors searching for the potential 100-baggers of tomorrow across sectors like AI, quantum computing, biotech, fintech, and cybersecurity, buying dips and dollar-cost averaging into high-conviction positions could pay massive dividends down the road. The market mania may only be just beginning.

Crypto’s Fallen Star: Sam Bankman-Fried Sentenced to 25 Years in Massive FTX Fraud Case

Posted on by slightbourne@noblecapitalmarkets.com

The meteoric rise and catastrophic fall of Sam Bankman-Fried reached its climax on Thursday as the former cryptocurrency wunderkind was sentenced to 25 years in federal prison for orchestrating a massive fraud that stole billions from customers of his failed FTX exchange. The sentence handed down by U.S. District Judge Lewis Kaplan represents a stunning downfall for the 32-year-old who was once hailed as the new face of the crypto industry before becoming a pariah following FTX’s implosion last year.

Bankman-Fried, who founded and led FTX until its rapid collapse in November 2022, was convicted in October of defrauding investors and misappropriating billions in customer funds. Prosecutors alleged the former billionaire siphoned $14 billion in customer deposits from FTX to fund risky bets at his Alameda Research hedge fund, while lying to investors and customers about FTX’s financial condition.

“He betrayed the trust of his customers, investors, lenders, and prosecutors with extraordinary measures of greed and arrogance,” Kaplan said in delivering the 25-year sentence. The judge lambasted Bankman-Fried’s “exceptional flexibility with the truth” and “brazenness” in carrying out the fraud schemes.

While his defense attorneys argued for leniency and just 6.5 years behind bars, prosecutors pushed for decades in prison, saying Bankman-Fried’s crimes represented one of the most brazen frauds in American history. In the end, the 25-year term landed in the middle, though Kaplan made clear his disdain for Bankman-Fried’s actions and lack of remorse, calling his conduct “reprehensible.”

The sentencing bookends a shocking downward spiral for the former crypto prodigy whose name was once synonymous with the soaring growth and potential of digital currencies and assets. At the height of his success, Bankman-Fried was celebrated for building a multi-billion dollar crypto empire while embracing ethics and effective altruism. But it all unraveled in spectacular fashion when the house of cards collapsed at FTX.

The fallout from FTX’s bankruptcy shook faith in the crypto industry to its core. Retail investors lost life savings, major companies faced financial ruin, and cries for more regulation rang out globally. In the immediate aftermath, Bitcoin and other top cryptocurrencies saw massive sell-offs amid a “crypto winter” as investors fled the sector.

However, over a year later, the crypto market has mounted a stunning resurgence that may signal the turning of the page on one of its darkest chapters. Led by Bitcoin’s meteoric rise above $30,000 for the first time since the FTX collapse, the total crypto market cap has rebounded to levels not seen since mid-2022.

The bulls have been let loose again as more institutional investors embrace crypto, with BlackRock recently launching a spot Bitcoin private trust to provide direct ownership of the leading digital currency. Crypto trading volumes and activity on leading exchanges like Coinbase and Binance have also surged.

While Bankman-Fried begins serving his decades-long sentence that will take him into his 50s, the cryptoworld he once towered over has re-emerged in full force. The scandals spurred greater regulatory scrutiny and industry reform, but it did not freeze out crypto’s underlying blockchain technology and innovative potential.

For the disgraced founder, his 25-year prison term essentially equates to a life sentence in the prime years of his career. The judge made clear that Bankman-Fried’s actions were “reprehensible” and deserved severe consequences as a deterrent to corporate bad actors. Crypto’s future, however, shines brightly again – a stark contrast to the deep craters left in the wake of FTX’s seismic implosion just over a year ago.

Bitcoin Soars to New Heights: Opportunities in the Crypto Market and Beyond

Posted on by slightbourne@noblecapitalmarkets.com

Bitcoin, the world’s largest cryptocurrency, has once again captured the attention of investors worldwide by setting a new all-time high price of nearly $69,000. This remarkable achievement serves as a reminder that even in the ever-evolving landscape of finance, there are always opportunities to be found – often in unexpected places.

The recent surge in Bitcoin’s value can be attributed to the launch of several spot Bitcoin exchange-traded funds (ETFs) earlier this year. These ETFs have provided everyday investors with unprecedented access to the cryptocurrency market, fueling a surge in demand that has outpaced the available supply. With institutional investors and ETFs scooping up more Bitcoin than is being mined daily, a supply crunch has emerged, further driving up prices.

While the crypto market has been the center of attention, this event also highlights the potential for overlooked investment opportunities in other sectors. Just as Bitcoin was once dismissed by many as a passing fad, there are countless emerging growth companies and innovative technologies that are currently being underestimated by the broader market.

Small-cap stocks, in particular, often fly under the radar of mainstream investors, yet they can offer significant upside potential for those willing to conduct thorough research and identify promising ventures. From groundbreaking medical innovations to disruptive technologies reshaping entire industries, the small-cap universe is brimming with hidden gems waiting to be discovered.

The key to successful investing in these often-overlooked areas lies in taking a long-term perspective and maintaining a diversified portfolio. Just as the crypto market has experienced its fair share of volatility over the years, emerging growth companies can be subject to significant price fluctuations as they navigate the challenges of scaling their operations and gaining market share.

However, for those with the patience and risk tolerance to withstand these ups and downs, the potential rewards can be substantial. Many of today’s industry titans, from Amazon to Tesla, were once small-cap companies with ambitious visions and innovative products that captured the imagination of forward-thinking investors.

As the Bitcoin story continues to unfold, it serves as a powerful reminder that investment opportunities can arise in unexpected places. By keeping an open mind, conducting thorough research, and maintaining a disciplined approach, investors can position themselves to capitalize on the next big thing – whether it’s in the realm of cryptocurrencies, cutting-edge technologies, or any other sector ripe for disruption.

Take a moment to take a look at Bitcoin Depot and Bit Digital who are exploring and pioneering the cryptocurrency sector.

Bitcoin Surges Past $50,000 For First Time in Over 2 Years

Posted on by slightbourne@noblecapitalmarkets.com

The price of bitcoin has crossed over the psychologically important $50,000 level this week for the first time since December 2021. The world’s largest cryptocurrency by market capitalization rallied roughly 15% over the past week to hit $50,000 on Monday afternoon, riding a wave of bullish sentiment in crypto markets.

Several factors are contributing to bitcoin’s renewed momentum above $50,000. Firstly, the recent launch of spot bitcoin exchange-traded funds (ETFs) has provided a boost to bitcoin prices. These ETFs, which hold actual bitcoin rather than bitcoin futures, have seen strong inflows from investors. According to data from Bloomberg, spot bitcoin ETFs recorded their second largest day of inflows last Friday, totaling over $540 million.

The two largest bitcoin ETFs – BlackRock’s iShares Bitcoin Trust and Fidelity’s Wise Origin Bitcoin Trust – have accumulated substantial assets after only one month of trading. The combination of easy access to bitcoin exposure through these ETFs along with optimism around the scheduled halving event in 2024 seems to be driving enthusiasm and higher prices.

The upcoming bitcoin halving, expected to occur in mid-2024, will see the bitcoin mining reward cut in half from 6.25 bitcoin per block currently to 3.125 bitcoin. This quadrennial event has historically been bullish for bitcoin prices over the long-term. According to a recent report from Grayscale Investments, while the halving poses challenges to miners in the form of reduced block rewards, innovations like Layer 2 scaling solutions could offset this by lowering transaction fees and enhancing throughput.

Beyond market structure changes like the ETFs and the halving, bitcoin also received a small boost from a geopolitical event last week. The re-election of pro-bitcoin President Nayib Bukele in El Salvador for another 5 year term was cheered by cryptocurrency advocates. El Salvador under Bukele was the first country to make bitcoin legal tender in 2021. While Bukele’s visions of a bitcoin-powered economy have stumbled, his re-election signals continued support.

After hitting the historic $50,000 mark, bitcoin pulled back modestly but has remained firmly above $48,000 over the past few days. The key question now is whether bitcoin can rise and continue trading stably above $50,000, which would signal a definitive change in market structure according to analysts.

Take a moment to take a look at Bit Digital, a large-scale bitcoin mining business and a sustainability focused generator of digital assets.

Previous rallies above $50,000 over the past two years have been short-lived, with bitcoin failing to establish support at those levels. In March 2022, bitcoin briefly topped $48,000 before slipping back down. And in early January this year, bitcoin hit $50,000 but quickly dropped below $45,000 within days.

This time, bitcoin investors are hopeful that conditions are ripe for bitcoin to finally break out above $50,000. Analysts at Bernstein recently predicted a “fear of missing out” or FOMO rally in bitcoin, as momentum builds following the breach of $50,000. However, bitcoin remains highly volatile, as evidenced by its drop from all-time highs near $69,000 in November 2021 down to below $20,000 by the end of 2022.

Market analysts will be monitoring key support and resistance levels, like the 200-day moving average near $46,500. As long as bitcoin can avoid dropping below these key technical levels, the bullish case remains intact. But buyers will need to maintain consistent support above $50,000 and catalyze follow-on demand in order for this latest move higher to be sustainable. Other factors like rising interest rates and broad macroeconomic uncertainty still pose downside risks.

Nonetheless, the combination of factors lining up in bitcoin’s favor – the surging interest and inflows into spot ETFs, optimistic narrative around the halving, and the breakout above $50,000 – has many crypto investors calling this bitcoin’s next bull run. As bitcoin solidifies its status within mainstream finance and garners attention from major institutional players like BlackRock and Fidelity, the dynamics appear to be changing in favor of greater price stability and less volatility. But bitcoin’s freewheeling ways are difficult to tame. We will soon find out in the coming weeks and months if bitcoin has finally matured enough to leave its past boom and bust cycles behind.

What Investors Need to Know if Bitcoin ETF Gets the Green Light

Posted on by slightbourne@noblecapitalmarkets.com

The long-awaited arrival of SEC-approved bitcoin exchange-traded funds (ETFs) promises to open the floodgates for mainstream investor exposure to the world’s largest cryptocurrency. After years of rejections and delays, the SEC appears ready to finally allow spot bitcoin ETFs that hold the digital asset directly.

This stamp of regulatory approval positions bitcoin to go fully mainstream in 2024. Financial advisors can now more easily allocate client assets into bitcoin through the familiar ETF wrapper. Major financial institutions and retirement accounts like 401(k)s will likely broaden access as well.

For crypto-curious investors, a spot bitcoin ETF offers a simpler way to gain exposure without dealing with digital wallets and exchanges. But navigating this new ETF landscape won’t be easy. Here’s what investors need to know:

Shop Around for Fees

Dozens of issuers have spot bitcoin ETF filings awaiting SEC approval. With so much competition, expense ratios are plunging. Several issuers like ARK Invest and Bitwise have waived fees completely for six months. Others range from 0.25% to over 1%. Pay close attention to fee structures, which will vary greatly between issuers.

Monitor Premiums and Discounts

While bitcoin itself is highly liquid, new ETFs may deviate from their net asset value or trading price. Factors like redemption policies and authorized participant rules could cause ETF shares to trade at small premiums initially. Keep an eye on premium/discount behavior, favoring ETFs that demonstrate efficient trading and tight spreads.

Consider Futures-Based ETFs Too

Spot bitcoin ETFs remove the futures curve drama, but don’t ignore futures-based funds. The ProShares Bitcoin Strategy ETF (BITO) has built a solid track record since launching in October 2021. Futures-based strategies could still make sense for tactical traders and institutional investors, despite added complexity.

Temper Short-Term Expectations

Bitcoin ETFs are unlikely to immediately trigger massive inflows from retail and institutional investors. Assets may reach $10 billion this year, but that’s tiny compared to bitcoin’s $900 billion market cap. Widespread adoption will take time as investors wait and see how these new products function.

Beware the Crypto Bubble

While bitcoin has rebounded from its 2022 lows, speculative excess still persists. Hundreds of altcoins with no utility or differentiators have billion dollar valuations. Cryptocurrency markets remain prone to volatility and hype cycles. ETFs offer exposure, but be wary of parabolic rallies.

Think Long-Term Store of Value

The bitcoin blockchain and protocol aren’t going away. Only 21 million BTC can ever be mined. Consider using ETFs as part of a diversified portfolio focused on bitcoin’s potential as a long-term store of value, similar to gold. But also be prepared for 50%+ drawdowns during times of market stress.

Look Beyond Bitcoin

Bitcoin ETFs are just the beginning. The SEC has yet to approve ETFs holding other major cryptocurrencies like ether and solana. If these are eventually permitted, diversified crypto ETFs could become an enticing one-stop shop. Institutional investors are already trading cryptocurrency index funds tracking a basket of assets.

Understand the Tax Implications

Cryptocurrency remains subject to complex U.S. tax rules that classify it as property. Investors must pay capital gains taxes whenever selling at a profit, including cashing out of ETFs at a higher bitcoin price. Long-term tax rates are more favorable. Financial advisors can help craft tax-smart crypto strategies.

See How Institutions Respond

Large asset managers and financial institutions will need time to evaluate these new products before allowing clients access. Their embrace could drive billions in inflows. But if major players bar access or remain cautious, retail adoption may lag. Pay attention to their stance.

Approval of spot bitcoin ETFs removes a huge roadblock to mainstream crypto investment. But it’s still early days. As investors navigate this rapidly evolving landscape, following prudent portfolio strategies and avoiding FOMO will be key to capitalizing on this milestone.