Bitcoin with leverage: the rise of American mining companies

Digging for assets is a tradition in the US. But instead of yellow precious metals, North America is likely to be digging for Bitcoin first and foremost in the future. In the latest issue of the Cryptocompass, we look at the consequences of the Chinese mining ban and take a look at the hash rate rebalancing.

This had caught the crypto sector cold. When the Chinese government had made tabula rasa regarding Bitcoin mining in June, many a market observer was already painting the devil on the wall. But the signs are becoming clearer: it’s all turning out quite differently. Instead of a miningdeath spiral, the world’s largest decentralized network is likely to emerge stronger from the China crisis in the medium term. This is according to our analysis in the latest issue of Cryptocompass.

Mining in North America: first gold, now bitcoin?

However, hashrate concentration in the Middle Kingdom has not just been on the decline since the Chinese sweep. As we show in the Cryptocompass, mining companies have been moving elsewhere for some time. Popular among miners are regions such as Central Asia and Scandinavia, among others, and – you guessed it – the new place of yearning for crypto miners is: North America. The China ban is likely to accelerate this trend significantly.

Bitcoin with leverage: the rise of American mining companiesBitcoin with leverage: the rise of American mining companiesBitcoin with leverage: the rise of American mining companiesBitcoin hash rate on an annual chart. Source: blockchain.com

But what exactly makes North America the promised land for miners? In our cover story, we highlight two reasons above all others: cheap electricity prices and political stability.

The former has always been a crucial factor in bitcoin mining. After all, the business is highly competitive, the margins thin, and the running costs huge. Those who manage to wring below-average electricity prices from utilities win. China was known for these very prices; the U.S. could be. That’s because electricity is getting cheaper and cheaper, especially in states like Texas that are increasingly relying on wind and solar power.

How to profit from the digital gold rush

While mining was still a wild, unregulated field of activity in the early days of cryptocurrency, it is attracting more and more professional and even publicly traded companies. In the Cryptocompass we show how investors can participate in the new mining business and where investments are worthwhile.

Argo Blockchain (ISIN: GB00BZ15CS02) is a good example. As of the editorial deadline, the London-based company has a market capitalization ofalization of 630 million US dollars. Argo Blockchain already operates a number of mining farms in Canada and plans to launch a 200 MW mining facility in Dickens County, Texas. Says Argo CEO Peter Wall:

We like to mine in North America. In 2018, we started mining in Quebec because we had access to cheap renewable energy. Those incentives are still there because North America continues to benefit from very cheap energy. In Quebec, for example, we pay just 3.8 cents per kilowatt hour of electricity.

Early investors are rejoicing: Argo Blockchain’s (ARB) share price is trading up 2,290 percent year-over-year.

If you want to read the entire cover story and find out which stock candidates in the mining sector are particularly exciting, we recommend the new issue of Kryptokompass.

By the way: As an active Kryptokompass subscriber you have the unique chance to win a much sought-after Playstation®5.