Here is a Bitcoin mining stock to buy now

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Bitcoin’s (CRYPTO: BTC) share price surge – up over 357% in the past 12 months – has sparked a huge surge in interest in mining the coin for profit . Unfortunately, there’s a big hurdle for those who would like to jump in on the action: The cost of the machines used to mine coins is around $ 16,000 each – and it’s not like you don’t have any. only need one.

But investors don’t have to shell out a small fortune to start mining. What is much more accessible is investing in Bitcoin mining companies that have already set up platforms. One of those promising companies is Hut 8 Mining (NASDAQ: HUT), which has climbed more than 1000% in the past year.

Image source: Getty Images.

Why Hut 8 Mining?

Much of the appeal of Hut 8 lies in its plans to scale up its mining operations to perform 2.5 quintillion guesses per second – a measure known as the hash rate – in search of the mathematical solution. needed to mine a new block on the Bitcoin blockchain. This equates to 1.78% of the network hash rate and is a huge improvement over Hut 8’s 1 quintillion (one exahash) per second hash rate last year. The company mines between 12 and 18 Bitcoins per day, valued between $ 518,000 and $ 778,000 at recent Bitcoin prices.

In the second quarter of 2021, Hut 8’s revenue increased an astonishing 263.5% from the previous year to C $ 33.55 million. At the same time, its operating profit rose 230.2% to C $ 8.12 million.

Right now, he owns around 4,450 BTC, valued at around $ 219.5 million, but unlike other miners, he’s not just planning to sell them ASAP. To maximize shareholder returns, Hut 8 lends out the BTC it operates. Coin owners can receive up to 6.20% interest per year on Bitcoin loans, based on current rates.

If that wasn’t enough, the company plans to take its operations to another level. Hut 8 now has around 144 megawatts (MW) of electrical capacity, the equivalent of around 86 power turbines operating at low performance. But by 2022, it will increase that number to 209 MW. With more power, the company will be able to operate more mining rigs and, as a result, further increase its revenue and profits.

On top of that, Bitcoin’s network usage is set to increase. In November, Taproot’s long-awaited upgrade will go live on its blockchain. Taproot will reduce transaction fees and improve network privacy, greatly encouraging its use in the rapidly evolving cryptocurrency markets.

Sustainable operations

It’s no secret that the Bitcoin network consumes a lot of power. In fact, a Bitcoin transaction uses as much electricity as 12 million Visa transactions. As a result, Bitcoin miners who depend on coal-fired power plants for electricity have come under intense scrutiny, especially in China.

Hut 8’s operations are more environmentally sustainable than those of most competitors. The company’s mining platforms are located in Alberta, Canada, and use electricity generated by a mixture of natural gas, wind power and solar power. Additionally, Hut 8’s mining rigs cost just $ 0.022 per kilowatt hour to operate, which is the cheapest among publicly traded BTC mining companies.

Due to its rapid revenue growth, Bitcoin lending, strong margins, and sustainability, Hut 8 is a cryptocurrency mining stock that you don’t want to miss. Even with stock trades at 10x revenue, the assessment is worth it, given its future expansion plans and Bitcoin’s ongoing network overhaul.

This article represents the opinion of the writer, who may disagree with the official recommendation position of a premium Motley Fool consulting service. Were motley! Questioning an investment thesis – even one of our own – helps us all to think critically about investing and make decisions that help us become smarter, happier, and richer.

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