(Bloomberg) – The eight largest publicly traded Bitcoin mining companies hire Asher Genuto to replace Jamie Leverton as chief executive, three weeks after short sellers released a report criticizing recent mergers. Appointed the person in charge (CEO).
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The migration will take effect immediately. Mr. Genuto served as Chief Operating Officer and President of Bitcoin Corporation of America. Bitcoin USA, which is headquartered in Miami and has large-scale mining facilities across the United States, including Texas, completed its merger with then-Canadian miner Hut8 in late 2023.
The change in management comes as a result of increased competition among miners, a Bitcoin code update that is expected to significantly reduce mining revenue within about two months, and a January 18 report from short seller J Capital Research on the merger. This comes amid claims by the company that it was a “pump and dump.” ” is waiting to happen. Hut 8 disputes this claim.
“The report did not prompt the board to take action,” Genuto said in an interview. “This conversation has been a much larger strategic conversation over the past two months since we merged as a company, and this report was in between.”
He said the main motivation behind the company’s change in direction was to improve efficiency and focus on “operational excellence” ahead of the so-called halving, which will cut bitcoin mining rewards in half and increase mining profitability. He added that it was a matter of guessing. This halving is a pre-programmed event scheduled for April. It’s much thinner.
When J Capital’s report was released, Hut8’s stock price fell by as much as 26%. This was also the day that company officials rang the bell for the start of trading on the Nasdaq stock market. Hut 8 closed 1.7% lower at $6.76 on Wednesday.
While the price of Bitcoin is falling, crypto mining companies are seeking mining rewards, a set amount of new coins released from the Bitcoin blockchain for miners who successfully verify transactions on the network. We are strengthening our business to compete.
Bitcoin mining is an energy-intensive process, and the more computing power a miner has, the more likely he is to earn rewards. Mining difficulty, a measure of the computational power required to mine Bitcoin, hit a new all-time high last year, requiring miners to spend more money on new mining computers and electricity to earn the same amount of rewards. It means something.
Due to the “halving”, Bitcoin mining rewards will be cut in half in April. The quadrennial update is part of Bitcoin’s code designed to maintain an eventual supply cap of 21 million Bitcoins.
J Capital’s report accused Hut8 of a number of issues that could have a negative impact after the halving, including private equity ownership, connections and poor operating efficiency. Some large mining companies have acquired large amounts of new machinery and power plants to increase efficiency while reducing operating costs.
Hut 8 said that J Capital’s claim that the company’s mining costs are high is not accurate, but acknowledged that Genuto has “not had much growth” compared to other Bitcoin mining sectors.
During Mr. Leverton’s three-year tenure, Hut8 has become one of the few crypto mining companies that can also provide high-performance computing services to customers, including some artificial intelligence startups, in addition to its Bitcoin mining operations.
(Updates with comments from new CEO Genoot in 4th, 5th, and 11th paragraphs.)
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