Bitcoin miner Stronghold explores sale after halving

Following the halving, some Bitcoin miners are reshuffling operations to adjust to the new paradigm and one entity is considering all options. 

According to a press statement, Stronghold Digital Mining is exploring options to maximize shareholder value, including a complete sale of the company and its assets. 

The Bitcoin (BTC) miner uses leftover coal as an energy source for its Pennsylvania-based cryptocurrency mining facility. Per the May 2 announcement, Stronghold highlighted a disparity between its stock prices and valuations commanded by market competitors. 

Google Finance showed a 62% decline in Stronghold’s SDIG stock this year, although other Bitcoin miners like Riot and Marathon Digital have also recorded dwindling equity prices. 

After Stronghold disclosed its plan, SDIG jumped 7% in pre-market hours as the Bitcoin miner assessed available pathways. The firm reportedly engaged financial advisers Cohen and Company Capital Markets to this effect. 

“Stronghold’s Board and management team are committed to maximizing value for our shareholders and, to that end, have commenced a comprehensive and thorough review of strategic alternatives.”

Greg Beard, Stronghold CEO and Chairman

Expert: Bitcoin miner market will see a shift after halving

The Bitcoin halving slashed mining rewards by 50% and entities that deploy computing power to find new blocks will see reduced revenue. Reports suggest no signs of miner capitulation yet and firms like Marathon also moved to double mining capacity this year. 

Still, many expect to see changes in the Bitcoin mining market as profit margins have changed due to the halving. Arrows Markets co-founder conveyed to crypto.news that the entry barrier has increased and existing players could look towards mergers or acquisitions to bolster operations. 

“Existing miners will likely consolidate, with inefficient rigs becoming obsolete. Survivors will upgrade for efficiency or explore alternative coins. New entrants will be rare due to lower profitability.”

Edward Mehrez, Arrows Markets co-founder