On a fateful day, February 25, 2025, the stock of Bitdeer Technologies Group plummeted like a lead balloon, dropping over 28% after the Bitcoin miner revealed earnings that were as disappointing as a soggy sandwich. The fourth quarter of 2024 was not kind, with revenues clocking in at a mere $69 million, a staggering 40% drop from the same time last year. Meanwhile, the company reported net losses exceeding $530 million, a far cry from the $5 million loss of Q4 2023. Talk about a financial hangover!
As the sun rose on February 25, Bitdeer’s stock fell from a lofty perch of over $13.10 per share to a dismal $9.30. Ouch! 😬
Halving Struggles
The earnings miss came as miners, like weary travelers, struggled to adapt after the Bitcoin network’s April 2024 halving event, which effectively sliced Bitcoin (BTC) mining revenues in half. It’s like trying to make a meal with half the ingredients!
According to Harris Bassett, Bitdeer’s chief strategy officer, the “lower performance compared to Q4 2023 was primarily driven by the impact of the April 2024 halving,” along with “increased global network hash rate” and higher research and development costs. Sounds like a recipe for disaster!
In January, Bitcoin’s hashrate — the total computing power securing the network — reached a new all-time high of over 1,000 exahashes per second (EH/s). It’s like the network is on steroids!
In a bid to offset the declining mining revenues, Bitdeer decided to sell its own energy-efficient Bitcoin mining hardware. However, sales were still in the slow lane and didn’t quite make up for the weakness in other business lines during Q4. It’s like trying to fill a bucket with a hole in it!
“We made a deliberate decision to prioritize resources on the development of our own ASIC [mining hardware] technology,” Bassett explained. “This limited our Hash rate growth but gives us massive advantages going forward that differentiate our business from the rest of the sector.” He’s optimistic, but let’s hope that optimism doesn’t turn into wishful thinking!
Bitdeer noted that the market for specialized hardware known as ASIC chips totals a whopping $4 billion–$5 billion. That’s a lot of chips!
As the halving eroded Bitcoin mining revenues, miners’ non-core business lines, such as chipmaking and servicing artificial intelligence models, are stepping into the spotlight. It’s like a talent show where everyone is trying to outshine the star!
Every four years, the number of BTC mined per block, a bundle of transaction data stored on the blockchain, is reduced by half. The April event reduced mining rewards from 6.25 BTC to 3.125 BTC per block. It’s a tough world out there!
Bitcoin miners Marathon Digital and Core Scientific are set to report earnings on February 26. Let’s see if they can dodge the bullet!
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2025-02-25 19:58