Will Bitcoin Mining Keep Growing? This Company Thinks So

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The following post was written and/or published as a collaboration between Benzinga’s in-house sponsored content team and a financial partner of Benzinga.

Cryptocurrencies have created a buzz around the world partly because of the increase in their prices over the years. The recent surge in prices has lured the attention of investors, traders and miners — people who are rewarded crypto coins for solving complex mathematical formulas to keep the blockchain system in check.

In its 3rd-quarter financial report, Tesla Inc. TSLA reported that it holds $1.26 billion worth of Bitcoin (BTC) in its balance sheet. This comes a few months after Tesla CEO Elon Musk, who is a crypto proponent, revealed via Twitter that he owns Ether (ETH), Dogecoin (DOGE) and the popular Bitcoin. If it's not news that both Tesla and Elon Musk have investments in cryptos, it’s news that singer Mariah Carey is encouraging her fans to start investing in crypto by offering $20 worth of Bitcoins.

Another company that decided to expand its portfolio by investing in Cryptos is OLB Group Inc. OLB. The company, which says it started as a creative and market service provider and later turned into an e-commerce service provider, ventured into the crypto market through its subsidiary DMint Inc.

OLB states that its entry into the field puts it together with other big players in the crypto space, including Marathon Digital Holdings MARA, Bit Digital Corp. BTBT and Riot Blockchain Inc. RIOT. Rather than holding Bitcoins like other companies in the industry, OLB's strategy is Bitcoin mining.

Mining Versus Holding Cryptos

Holding involves buying cryptos on the market and keeping them in a wallet with a plan to sell in the future when the price is high; in other words, buying low, selling high. The main advantage is it is simple; anyone can do it. Simply put in a buy order, purchase the crypto and wait for a suitable time to sell when the price is high. Holding carries risk if the price tumbles.

Mining on the other hand does involve a large initial investment in buying mining equipment and electricity costs. The advantage it has over holding is that as long as electricity costs are kept low, it is possible to earn Bitcoin or other cryptos at a lesser price than the market value.

OBL Also Says It’s Taking Crypto Mining Green

Bitcoin mining uses huge amounts of electricity, most of it generated from fossil fuels — especially coal — drawing criticism from environmentalists and carbon-free advocates. Earlier this year, Tesla announced a halt in using Bitcoin to pay for its vehicles because of the environmental impact associated with mining the currency.

Musk tweeted that the company is concerned about the rapid increase in the use of fossil fuel for Bitcoin mining and transactions, and it will not be selling any Bitcoins until mining transitions to more sustainable, carbon-free energy.

OLB, through DMint, states that it uses carbon-free mining solutions to run its data centers. To support the 1,000 Antiminer S19j Pro 96T mining machines that the company bought from Bitmain, OLB has acquired massive natural gas rights needed to power its current and future energy needs. When fully deployed, the machines are expected to generate up to $1 million in revenue per month.

The company hopes that the environmental impact of the crypto mining rigs will be reduced to nearly zero as the natural gas will be taken straight from the well heads to generate electricity. This move could attract investors who criticize Bitcoin mining for being an escalator of the climate crisis.

The Global Bitcoin Business

Calculating the market cap for Bitcoin is not rocket science. On average, 6.25 Bitcoins are mined per block. That's an equivalent of 900 Bitcoins released every day, 328,500 each year.  On Oct. 26, 1 Bitcoin was worth $62,119.81, bringing the global Bitcoin business to $20,406,357,585 per year. However, mining difficulty increases over time, so the future may hold unique scenarios for miners across the globe.

The preceding post was written and/or published as a collaboration between Benzinga’s in-house sponsored content team and a financial partner of Benzinga. Although the piece is not and should not be construed as editorial content, the sponsored content team works to ensure that any and all information contained within is true and accurate to the best of their knowledge and research. This content is for informational purposes only and not intended to be investing advice.