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Currently MARA is the mining company with the largest bitcoin reserves, with 44,893 BTC.
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In the past, bitcoin lenders have gone bankrupt during “crypto winters.”
Marathon Digital Holdings (MARA), the world’s largest market cap Bitcoin (BTC) mining company, announced that it offered a total of 7,377 BTC in loans at the end of December 2024.
This amount of bitcoins lent by MARA represents around 16% of its total holdings in this crypto asset, which amount to 44,893 BTC ($4.4 billion at the time of this writing). This is according to its latest report dated January 3, 2025.
In this sense, MARA is currently the second publicly traded company with the largest reserves in bitcoin, falling behind MicroStrategy, which owns 446,400 BTC (almost $44 billion), according to the Bitcoin Treasuries site.
Regarding MARA’s strategy of offering BTC loans, its Vice President of Investor Relations, Robert Samuels, expressed himself.
The manager explained that “there has been significant interest in the loan program” and that this type of business focuses on “short-term agreements with well-established third parties.” However, it did not offer information about who the companies, institutions, investors or third parties involved would be.
Samuels stated that the performance throughout 2024 of this practice was “1 digit”, although he did not specify the amount, but concluded his message by clarifying the purpose behind the loans offered by MARA.
“The long-term goal is to generate enough performance to offset operating expenses.”
Robert Samuels, Vice President of Investor Relations.
The track record of Bitcoin lending companies is not encouraging
Following Robert Samuels’ post, some platform X users responded to the manager’s message with some pessimism due to the counterparty risks inherent in lending services.
Among the comments, they recalled that in the past there were some companies that offered this service and that several of them fell into bankruptcy when the cryptocurrency winter arrived in 2022.
Such was the case of BlockFi, which fell into bankruptcy in November 2022 and managed to leave this state almost a year later. This company was one of the first to offer cryptocurrency-secured loans and cryptoasset savings accounts.
In early 2022, BlockFi faced significant challenges during “crypto winter” 2022 given the volatility of the cryptoasset market, and especially following the collapse of FTX, to which BlockFi had considerable financial exposure. This led to it filing for bankruptcy in November 2022, having more than 100,000 creditors.
Like BlockFi, other lenders have had a similar journey, such as Celsius Network. As NoticiasVE reported, by September 11 this company had paid 2.5 billion dollars to its creditors.
With MARA being a publicly traded company, some investors doubt whether the potential profits are worth the risk. Unlike a loan in dollars, when Bitcoin is lent there is the possibility of never recovering those coins again, due to the scarcity of the asset.
So MARA risks not only borrowers failing to meet their obligations in a timely manner, but to lose part of your treasure in Bitcoin.
However, MARA’s strategy can be seen as a second phase in its goal of accumulating as much Bitcoin as possible. Miners need liquidity to be able to finance their operations, so they are usually forced to sell BTC. Offering loans is an alternative to maintain your reserves in BTC and be able to obtain a return on your capital.
It is likely that these types of strategies will become increasingly popular not only among miners, but also in other companies with large Bitcoin treasuries such as MicroStrategy, so it will be necessary to develop mechanisms that enable the business and mitigate the risks.