Contemplating the crypto mining space

Posted on September 17, 2022

(Updated on Nov 3, 2022)

I foresee a challenging period ahead for the crypto world, a chilling crypto winter, if you will. Yet, despite the hurdles, I maintain my firm belief in the long-term potential of Bitcoin and other digital assets. If I'm to leverage my understanding of the space effectively, it is crucial to identify and seize opportunities in these challenging times.

Between June and August 2022, I acquired various assets, some for monitoring price movements and others for establishing a modest position. I have invested in ventures such as Marathon Digital Holdings, Core Scientific, Ebang International Holdings, Agro Blockchain, Canaan, and Coinbase. These purchases serve as a testament to my belief in the strategic value of these companies within the digital asset space.

Recently, I had the privilege of engaging in a conversation with Gary Vecciarely, CFO of Clean Spark, a company focusing on sustainable crypto mining. Clean Spark contradicts the common notion of crypto mining as an excessive energy-consuming process, as they employ renewable energy sources for their operations. Despite the company's significant investment in infrastructure and mining equipment, investors often struggle to evaluate its worth accurately. With positive FCF last year and substantial potential upside, I believe Clean Spark could quadruple in value over the next 3-4 years.

As the price of BTC continues to fluctuate, I aim to expand my holdings in these companies, along with Clean Spark and others that may emerge as promising opportunities. Despite the lack of significant unrealized gains or even potential losses, I intend to hold my positions and buy more during downturns. As a believer in the long-term narrative of the crypto space, I foresee a future where digital wallets become ubiquitous and transactions involving goods and services using BTC become commonplace.

Nevertheless, it is essential to brace ourselves for another cold crypto winter before we can fully harvest the benefits of this burgeoning field. While I remain cautious about the inherent volatility in BTC prices, I also see the potential of BTC surging to as high as +80k or 100k EUR. It's all a matter of patience. When the price dips, I will be ready to act.

Supporting companies that enable the growth of BTC and other cryptocurrencies is an intentional strategy. These companies offer productive assets and grant leverage within the digital asset space. Some of these ventures have made substantial investments in machinery and infrastructure to mine cryptocurrencies. I believe that some of these companies will emerge as leaders, operating large-scale crypto farms and providing vital infrastructure as a service. Their current endeavours may be laying the groundwork for future opportunities.

As we look towards the future, it remains to be seen how the landscape of crypto and blockchain technology will evolve. But one thing is for sure, as the old song goes, "Who knows what tomorrow will bring. Maybe sunshine, and maybe rain. But as for me, I'll wait and see. Maybe it'll bring my love to me" (https://www.youtube.com/watch?v=1jVaKBB0jHU).

Thank you for reading. Stay tuned for more insights into my investment journey.

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