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Idle machines and spectacular pay: the byproducts of a banner year for bitcoin miner Marathon

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Idle machines and spectacular pay: the byproducts of a banner year for bitcoin miner Marathon

by Ryan Weeks
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Quick Takes
  • Marathon’s recent results show massive increases in revenue and hashrate over the course of 2021, in line with surging crypto markets. 
  • A lucrative incentive scheme meant that former chairman Merrick Okamoto has cashed in on the company’s big year in spectacular fashion. 
By most measures, 2021 was a banner year for bitcoin mining company Marathon Digital Holdings.

But with that success came two eye-grabbing byproducts: lots of bitcoin mining machines now sitting idle and an extraordinarily well-compensated former executive.  

The company’s recent results, published March 1, highlight rapid growth across most key metrics. Revenue for the fiscal year ended December 31 grew 3,353% year-on-year to $150.5 million. The company mined 3,197 bitcoin, an 846% increase.  

The bulk of Marathon’s gains is paper-based because the company hasn’t sold any bitcoin since October 2020. But most relevant metrics — including hash rate and the value of its investment fund — rose sharply.

So did the company’s costs, however. Its direct cost of revenues in 2021 rose 381% to $33.7 million. This metric encompasses co-hosting fees, electricity, depreciation and amortization expenses of mining machines and patents, and so on.

Excluded, though, are another $201.8 million in expenses — of which $156 million came in the form of stock-based pay (net of withholding taxes). 

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