Data center infrastructure firm Hive Digital is reaffirming its commitment to a long-term Bitcoin treasury strategy, utilizing the recent market downturn to enhance its mining capabilities and target new acquisitions. This approach reflects a broader trend among public miners to hold onto their mined assets rather than selling them.
In a discussion with industry outlets, Hive Digital’s CFO, Darcy Daubaras, emphasized the company’s aim to retain a substantial portion of its mined Bitcoin to capitalize on potential price increases. Effectively managing treasury operations is essential for maintaining liquidity, especially during significant market fluctuations like Bitcoin’s recent 30% decrease. According to Daubaras, a long-term holding strategy for Bitcoin is preferable to the prevalent industry practice of relying on debt or equity dilution to secure funding.
Recent reports indicate that public miners have increasingly opted for equity dilution—issuing new shares to raise funds—as part of a larger deleveraging trend driven by high interest rates and reduced creditworthiness. Without these financial maneuvers, miners often find themselves compelled to sell off their mined Bitcoin aggressively to support their operations or expansion plans.
While Hive does not shy away from selling some Bitcoin, having done so to finance its acquisition of a 200-megawatt facility from Bitfarms in Paraguay, Daubaras prefers a strategy of selective sales to fund valuable investments. This approach balances operational growth with long-term strategic positioning.
In the last quarter of 2024, Hive increased its Bitcoin holdings, raising its “HODL” position to 2,805 BTC.
### The Significance of Diversification and Scalability
The bullish market conditions facilitate the accumulation of Bitcoin for miners, yet achieving sustainable success involves navigating unpredictable price fluctuations, escalating competition, and rising energy and equipment costs. To address these challenges, Hive has adapted its business model to incorporate AI data centers and has prioritized renewable energy sources.
Company executives revealed in September that a portion of their Nvidia GPUs has been repurposed for AI applications, generating revenues exceeding $2.00 per hour, compared to only $0.12 per hour for cryptocurrency mining. Other mining companies, including Core Scientific, Hut8, and Bit Digital, are making similar adjustments. This shift was highlighted in an October mining report, noting that less profitable Bitcoin mining could drive many firms to diversify their income through AI ventures.
Diversifying operations has also emerged as a critical insight in a January report that identified high-performance computing and AI as viable options for generating predictable revenue streams that can help mitigate volatility associated with mining.