Another block reward mining group binges on hardware purchases

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On Monday, NASDAQ-listed BTC mining company Marathon Patent Group, Inc. (NASDAQ:MARA) issued a press release announcing the purchase of 10,000 new Antminer S-19 Pro ASIC Miners from Bitmain Technologies Ltd. The purchase boost Marathon’s existing operation of 2,560 miners by an additional 1.10 EH/s (Exahash). 

Marathon schedule the first shipment of 500 S-19 Pro miners to arrive at its Hardin MT facility in November 2020. In 2021, the company plans to receive a 4,000 shipment of miners on January 6th, 300 in February, 4,800 during March, and finally 1,800 each month afterward until they have received all the miners purchased. 

Marathon’s CEO, Merrick Okamoto, stated in the release, “We are pleased to announce the continued growth of our mining operations against the backdrop of recently increasing Bitcoin prices. Upon delivery and full Installation of all purchased miners, the company’s mining operations will include 23,560 next-generation miners bringing our total hashrate to 2.56 Eh/s and making us the largest self-miner in North America.

CoinGeek has been very consistent in our reporting that mining digital currency solely to win a share of the block subsidy reward is a dying industry. The only sustainable path forward for the sector is to develop into transaction processors. Only the Bitcoin SV blockchain provides the protocols required for this evolution to occur. 

Sadly, many in the ecosystem remain bereft of vision and foresight, oblivious to the fact the industry is rapidly outgrowing them. TAAL’s Jerry Chan alluded to these sentiments to the audience at the recent virtual Baikal Blockchain & Crypto Summit 2020 that:

“Miners have been chasing block subsidies to make rewards to pay for their capital investment. [But] this is a short-term business model, putting capital up in hopes that the asset you are digging up appreciates in value. If it doesn’t, then you would have wasted a lot of capital and time.”

Chan further stated that “We see that this is not a long term sustainable business model.” 

History has shown there is no guarantee that digital currency prices will rise. Once you remove all the speculative and gambling uses in the market, most coins and tokens have little utility. 

Chan recognizes this, which is why TAAL Distributed Information Technologies Inc. (CSE:TAAL | FWB:9SQ1 | OTC: TAALF) is an example of a leading company that made the transition from block reward miner into a transaction processor and blockchain services provider.

Blockchain is not for everyone, and everyone is not right for blockchain. The industry will inevitably shed some teams in order to boost others that understand the long-term potential of a scalable blockchain protocol for the enterprise community. Once this sets in, even publicly traded companies like Marathon are at risk of being left behind. 

See also: Jerry Chan’s presentation at CoinGeek Live on The Shift from Bitcoin “Miners” to “Transaction Processors”