US Investment Firm Declares ‘War Against Bitcoin Miners’


Kerrisdale
Capital,
a
US
investment
firm,
set
off
a
storm
of
reactions
on
Wednesday
with
a
series
of
public
communications
aggressively
targeting
Bitcoin
mining
companies.
In
a
multi-part

thread
on
X,
Kerrisdale
announced
its
campaign
against
what
it
describes
as
“snake
oil
salesmen”
in
the
BTC
mining
industry,
accusing
them
of
being
both
a
financial
sinkhole
and
an
environmental
hazard.

How To Get Free Crypto  

“Today,
we
launch
a
war
against
Bitcoin
miners,
an
industry
of
snake
oil
salesmen
that
are
incinerating
both
investor
capital
and
the
environment
and
should
be
banished
from
America
much
like
the
Chinese
RTO
frauds
that
we
helped
kick
out
a
decade
ago,”
the
firm
declared.

Kerrisdale
also
revealed
it
had
begun
by
sending
letters
to
officials
in
Texas,
including
the
Navarro
City
Commission
and
state
senators,
outlining
their
grievances
and
calling
for
regulatory
action.
Additionally,
the
firm
disclosed
its
financial
position,
stating,
“We’re
short
RIOT
(and
long
Bitcoin
as
a
hedge).”

Kerrisdale’s
critique
centers
on
the
business
model
of

RIOT
Blockchain,
which
it
argues
is
inherently
flawed:
“Like
other
US
listed
miners,
RIOT’s
biz
model
is
a
dysfunctional
hamster
wheel
of
cash
burn,
which
is
why
it
loots
retail
shareholders
with
non-stop
ATM
issuance
to
fund
operations.”
They
pointed
out
that
despite
BTC’s
high
market
prices,
RIOT’s
post-halving
operations
have
not
been
profitable.

Further
financial
analysis
from
Kerrisdale
highlighted
that
RIOT
has
issued
$2.3
billion
in
stock
since
2020,
which
has
led
to
a
sixfold
increase
in
shares
outstanding
to
fund
$1.6
billion
in
cash
burn.
According
to
Kerrisdale,
this
has
not
corresponded
with
an
increase
in
Bitcoin
production
per
share
or
BTC
holdings
per
share,
leading
them
to
conclude
that
the
only
benefit
to
shareholders
would
come
from
rising
Bitcoin
prices—a
strategy
they
deemed
insufficient
for
investment.

Coinbase Banner  

On
the
environmental
front,
Kerrisdale
criticized
Bitcoin
mining
for
its
heavy
energy
use
and
reliance
on
incentives
that
may
not
align
with
broader
environmental
goals.
“RIOT’s
economics
would
look
even
worse
without
generous
grid
incentives
and
tax
credits,”
the
firm
argued,
noting
that
such
benefits
are
being
questioned
by
regulators
and
might
not
persist.

The
Bitcoin
Mining
Industry
And
Experts
Responds

The
industry
response
was
quick,
with
several
prominent
figures
defending
the
sector
and
attacking
Kerrisdale’s
motives
and
understanding
of
the
space.
Daniel
Batten,
founder
of
CH4
Capital
and
advisory
board
member
at
Bitcoin
mining
giant
Marathon,
suggested
Kerrisdale
should
focus
more
on
enhancing
investor
returns
rather
than
attacking
industry
practices.

Adam
O
of
Upstream
Data
defended
Bitcoin
mining’s
environmental
impact,

stating,
“Good
luck
vilifying
that
which
improves
all
stakeholders,
reduces
waste,
and
reduces
methane
emissions.
Dumbest
mission
of
the
decade.”
Steven
Lubka,
Head
of
Private
Clients
&
Family
Offices
at
Swan
Bitcoin,
criticized
Kerrisdale’s
strategy
and
pointed
to
the
failing

MicroStrategy
(MSTR)
short
position
which
they
entered
two
months
ago
as
well
as
their
declining
assets
under
management
as
a
sign
of
deeper
issues
within
the
firm
itself.

FreeBitcoin Banner  

“Let’s
take
a
look
at
these
absolute
losers
crying
for
the
government
to
rescue
their
MSTR
short
by
FUD’ing
mining.
[…]
Now
let’s
take
a
look
at
their
AUM.
$318m
as
of
this
quarter,
let’s
see
where
they
were
a
few
years
ago?
$1.3
billion.
That’s
a
big
drop
in
their
total
AUM/invested
amount.
In
conclusion,
they
are
trying
to
save
their
fund
because
they
know
MSTR
is
about
to
rip
higher
by
appealing
to
the
government.”

The
debate
also
extended
to
the

environmental
merits
of
Bitcoin
mining.
Simon
Dixon,
an
angel
investor,
presented
facts
debunking
the
myth
that
Bitcoin
mining
is
predominantly
harmful
to
the
environment.
He
highlighted
the
role
of
Bitcoin
mining
in
methane
emission
mitigation
and
its
synergies
with
renewable
energy
sources
such
as
solar
and
wind,
as
well
as
the
ability
to
help
balance
the
grid.

Mark
Harvey,
a
Bitcoin
educator,
just
stated,
“You
will
make
a
higher
ROI
+
more
friends
by
just
buying
and
holding
Bitcoin.”

At
press
time,
BTC
traded
at
$70,820.

BTC
price
stalls
at
$71,000,
1-day
chart
|
Source:

BTCUSD
on
TradingView.com

Featured
image
created
with
DALL·E,
chart
from
TradingView.com

Go to Source
Author: Jake Simmons


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