Author: jk, Odaily Planet Daily

While the traditional Internet giants' increase in Bitcoin holdings is often for the purpose of diversified asset allocation (alternative investments), industry insiders often view it optimistically as a bullish signal for crypto, and even follow the "smart money" to take action.

However, the recent financial report season has revealed the current situation—under the bear market of crypto, the Bitcoin positions of large companies are mostly at a loss; different enterprises have different investment strategies, either reducing holdings and taking profits at opportune times, holding HODL, or firmly buying in and lowering the average holding cost.

Odaily Planet Daily has summarized the business overview, stock performance, latest developments, and Bitcoin holdings information (current quantity, average cost, profit and loss situation) of seven companies including Microstrategy, Galaxy, Tesla, Block Inc., Hut 8, Marathon Digital Holdings, and Meitu, and kindly reminds everyone that financial report disclosures have lagging information and should not be used as a single investment reference indicator.

Microstrategy

MicroStrategy is a company that provides highly specialized business intelligence, mobile software, and cloud solutions. The company was founded in 1989 and is headquartered in Tyson's Corner, Virginia, USA. MicroStrategy provides a variety of analytics and mobile software solutions for data visualization, reporting, and dashboards. These solutions are often used to help businesses better understand, monitor, and leverage their data.

The company's latest product, MicroStrategy ONE, is a comprehensive, modern, open, and cloud-driven analytics platform designed to be a single solution for all analytics use cases. From self-service data analysis and business reporting to advanced applications and embedded solutions, the platform aims to "unleash the power of data" to help businesses gain a competitive advantage.

Under the leadership of CEO Michael Saylor, MicroStrategy has also notably become one of the companies making large-scale investments in Bitcoin as a reserve asset strategy.

According to the second-quarter 2023 financial report, the company recorded a $24.1 million impairment expense for its Bitcoin holdings in the second quarter, compared to $917.8 million in the same period last year and $18.9 million in the first quarter of this year. The impairment of the company's digital assets reflects the decline in the price of Bitcoin relative to the acquisition price.

MicroStrategy's Chief Financial Officer Andrew Kang stated in a declaration: "As of July 31, 2023, our holdings of Bitcoin increased to 152,800 coins, of which 12,333 coins were added in the second quarter of this year, the largest quarterly increase since the second quarter of 2021. We effectively raised funds through our market equity plan and continued to increase our Bitcoin on our balance sheet using operating cash. We did this against a backdrop of increasing institutional interest, progress in accounting transparency, and increasing clarity in Bitcoin regulation."

Currently, the average price of Bitcoin held by Microstrategy is approximately $29,668.

According to Coingecko's data, Microstrategy's total cost of holding Bitcoin is $4.127 billion, and the current value of these Bitcoins is approximately $3.97 billion, accounting for about 0.728% of the total Bitcoin supply. The data shows that 46% of MicroStrategy's Bitcoin assets were purchased in 2020. In the third and fourth quarters of 2020, MicroStrategy purchased 38,250 coins (average price $11,151) and 32,220 coins, respectively. As of August 17, these BTCs accounted for 46.12% of MicroStrategy's Bitcoin assets.

As of the current date, MicroStrategy's total market value is $4.951 billion, with a stock price of $351.48 per share. Compared to approximately $246.91 six months ago, the stock price has significantly increased by about 42%. However, the stock has also experienced fluctuations within the year, reaching its peak in early July at around $475.09. Since the peak, the stock price has declined. This price fluctuation may reflect the market's multifaceted evaluation of MicroStrategy's strategy in business intelligence and Bitcoin investment.

Galaxy Digital

Galaxy Digital is a financial services and investment management company based in New York City, specializing in digital assets and blockchain technology. Since its establishment in 2018, the company has been building a comprehensive financial platform, including three complementary operating businesses: Global Markets, Asset Management, and Digital Infrastructure Solutions. Galaxy Digital aims to combine financial complexity with technological expertise to connect institutions with Web3 innovation.

The company offers a range of financial services, including trading, lending, strategic advisory services, institutional investment solutions, proprietary Bitcoin mining and custody services, network validation services, and the development of enterprise custody technology. Galaxy Digital has multiple offices globally, including in North America, Europe, and Asia.

Founded and led by experienced hedge fund manager and former Goldman Sachs partner Mike Novogratz, the company has been at the forefront of driving the application and acceptance of cryptocurrencies and blockchain technology in the mainstream financial world. Through its diversified business portfolio and global influence, Galaxy Digital aims to provide comprehensive cryptocurrency and digital asset-related services to retail and institutional investors.

According to the second-quarter 2023 financial report, Galaxy Digital performed well in the context of ongoing uncertainty and regulatory pressure. Novogratz stated that the company is moving towards long-term growth due to prudent risk management practices and a strong balance sheet.

Financially, the net loss in the second quarter was $46 million, a significant decrease compared to the net income of $134.2 million in the first quarter of 2023. Operating expenses in the second quarter were $85.2 million, a 6% decrease quarter-on-quarter and a 34% decrease year-on-year. The company's partner capital (equity) at the end of the quarter was $1.5 billion, a 3% decrease from the end of the first quarter, but liquidity remains strong at $696 million as of June 30, 2023.

In terms of business, Galaxy Global Markets (GGM) generated trading revenue of $59.5 million, a 54% decrease quarter-on-quarter, mainly due to a decrease in net realized gains from digital assets and derivatives. Investment banking revenue was $45 million, primarily due to a slowdown in mergers and capital raising activities. Galaxy Asset Management (GAM) generated asset management revenue of $33.8 million, a 619% increase quarter-on-quarter, mainly due to increased net realized gains on its venture capital platform. Galaxy Digital Infrastructure Solutions (GDIS) generated mining revenue of $15.4 million, a 51% increase quarter-on-quarter, mainly due to increased revenue from proprietary mining activities.

Currently, Galaxy holds approximately 12,545 Bitcoins, with a current value of approximately $326 million.

Compared to several other companies, Galaxy's stock price has relatively small fluctuations, currently at $5.08. Over the past year, the lowest price was $3.33, and the highest price was $8.30.

Galaxy's stock price over the past year. Source: Yahoo Finance

Tesla

Familiar to car consumers, Tesla, Inc. is an American electric vehicle and clean energy company, with Elon Musk serving as CEO and major shareholder. The company was founded in 2003, initially starting with the production of high-performance electric sports cars, but later expanding into a broader consumer market, introducing various electric vehicle models such as Model S, Model X, Model 3, and Model Y.

In addition to electric vehicles, Tesla is also involved in renewable energy products, including solar panels, solar roofs, and residential and commercial energy storage solutions (such as Powerwall, Powerpack, and Megapack). The company's goal is to accelerate the world's transition to sustainable energy.

In the second quarter of 2023, Tesla's financial performance exceeded Wall Street's expectations. The company reported that net income increased by 20% to $2.7 billion, primarily due to cheaper raw materials that helped offset the decline in vehicle prices. On the other hand, although new vehicle deliveries increased by 83% during the April to June period, revenue growth was not as strong, rising only 47% to $24.9 billion. However, this revenue still exceeded the average analyst expectation of $24.2 billion, according to FactSet's survey.

In the stock market, Tesla has also been closely watched. Its stock price has experienced significant fluctuations but has shown a strong overall growth trend, making it one of the world's highest valued automakers. From $108.10 at the beginning of the year to the current $245.01, Tesla's stock price has experienced significant fluctuations but has shown an overall upward trend in 2023. The stock price reached over $290 at its peak. This growth reflects the market's positive view of Tesla's continued innovation and market leadership in the electric vehicle and renewable energy fields. The company's total market value has now reached $777.659 billion.

In the cryptocurrency field, Tesla has been continuously followed for its large-scale holdings of Bitcoin, support for cryptocurrency payments, and Musk's status as a KOL in the industry. Tesla has not bought or sold Bitcoin for four consecutive quarters, and its current holdings are 10,500 Bitcoins, with a current value of approximately $272 million, accounting for about 0.05% of the total Bitcoin supply.

However, Tesla has suffered losses from its Bitcoin investment: the total cost of Tesla's Bitcoin purchases is $336 million, exceeding the current value by 23.5%.

Block Inc.

Block Inc. (formerly Square Inc.) is a multinational technology conglomerate founded in 2009 in the United States by Jack Dorsey and Jim McKelvey. The company launched its first platform in 2010 and has been listed on the New York Stock Exchange under the stock symbol SQ since November 2015.

Block Inc. initially started as a payment platform, primarily targeting small and medium-sized businesses, allowing them to accept credit card payments and use smartphones or tablets as point-of-sale (POS) terminals. Although the company has been renamed Block Inc., its flagship product for small businesses is still known as "Square."

As the business expanded, Block Inc. now has multiple business segments. Cash App is a mobile application that allows users to transfer money between each other and between users and businesses. Afterpay is a "buy now, pay later" service. Weebly is a website hosting service, and Tidal is a subscription-based music, podcast, and video streaming service, offering audio and music videos.

Block Inc. is not only committed to providing financial and payment solutions but is also continuously entering emerging financial technology fields, including cryptocurrencies. Overall, the company aims to simplify payment processes and make them more seamless and convenient through its diverse and comprehensive financial solutions.

Block Inc.'s stock price over the year. Source: Yahoo Finance

Block Inc.'s stock price has shown significant volatility this year, dropping from $64.64 at the beginning of the year to the current $58.17, with a market value of $35.488 billion. It is worth noting that the stock reached its peak in early February, at around $88, but has since declined. Despite an overall downward trend from the beginning of the year, the overall trend is somewhat correlated with the U.S. stock market and less correlated with cryptocurrencies than other stocks. Its market value remains relatively stable, indicating that the market still has confidence in this diversified financial technology company.

Block Inc. performed well in the second quarter of 2023, especially in a challenging economic environment. The company reported a net income of $5.3 billion in the three months, an increase from $4.4 billion in the same period last year and exceeding Refinitiv's estimates. The financial technology company's gross profit increased by 27% year-on-year, reaching $1.87 billion. Additionally, the company raised its 2023 EBITDA forecast from $1.3 billion to $1.5 billion.

The gross profit of Block's main business, Cash App, increased by 37% to $968 million. At the same time, the gross profit of the Square business increased by 18% to $888 million. Chairman Jack Dorsey stated that the company will continue to focus on expanding into international markets but is also seeking to control costs, including reviewing stock-based compensation. He also mentioned that the company has started to recruit more precisely, focusing on key roles and placing more emphasis on performance management. Adjusted for the quarter, Block's earnings per share were 39 cents, exceeding analysts' forecast of 36 cents.

According to Coingecko's data, Block currently holds 8,027 Bitcoins, with a cost of $220 million, now valued at approximately $209 million, with a relatively small loss.

Hut 8

Hut 8 Mining Corp. is a Canadian Bitcoin mining company that focuses on Bitcoin mining using advanced hardware and data center resources. The company is one of the largest publicly traded Bitcoin mining companies in North America, with significant computing power. Hut 8 not only operates as a Bitcoin mining company but also provides other services and solutions related to cryptocurrencies, such as high-performance computing.

Hut 8 typically sets up its mining facilities in areas with low energy costs, such as remote locations in Canada, to reduce operating costs and increase efficiency. This allows the company to remain competitive in the highly competitive cryptocurrency mining market.

Hut 8's data center locations. Source: Hut 8 official website

Hut 8's stock price has shown significant volatility in 2023, rising from $0.818 at the beginning of the year to the current $2.37, with an overall upward trend. The stock reached its annual high of around $4 in mid-July, followed by a decline. Despite this, the stock price has seen considerable growth compared to the beginning of the year. This price dynamic reflects investors' views on the company's performance and potential in the Bitcoin mining field. Currently, Hut 8's total market value is $526.7 million.

In the second quarter of 2023, Hut 8's operating revenue decreased to $19.2 million, a significant decline from $43.8 million in the same period last year. During this period, the number of Bitcoins mined by the company also decreased by nearly 58% to only 399, mainly due to the increase in Bitcoin network difficulty, the suspension of operations at the North Bay facility, and ongoing power supply issues at the Deland Heli facility. Its high-performance computing (HPC) business also saw a slight decline, generating only $4.2 million in regular monthly revenue, a decrease from $4.7 million in the same period last year. By the end of the quarter, the company's hash rate reached 2.6 EH/s (excluding the North Bay facility), and it holds 9,136 self-mined Bitcoins. During this quarter, the company generated $14.7 million in revenue by selling 396 Bitcoins.

Currently, Hut 8's Bitcoin holdings are valued at approximately $242 million.

Last week, Hut 8 announced its upcoming merger with U.S. Data Mining Group, Inc. (operating as "US Bitcoin Corp" or "USBTC"). The transaction is expected to create a new company called "New Hut," headquartered in the United States. The new company will focus on economically efficient Bitcoin mining, diversified revenue streams, and industry-leading environmental, social, and governance (ESG) practices.

Hut 8 CEO Jaime Leverton stated that they expect to receive approval from the U.S. Securities and Exchange Commission (SEC) for the registration statement of "New Hut" in the near future and believe that after completing this merger, the new company will become a stronger and more dynamic business entity. This entity will be supported by a significant amount of fiat currency revenue generated from Bitcoin and high-performance computing operations across North America.

Marathon Digital Holdings

Marathon Digital Holdings (formerly Marathon Patent Group) is a U.S. company that primarily focuses on Bitcoin mining. The company was founded in 2010 and initially operated as an intellectual property (IP) company but later transformed into a business dedicated to cryptocurrency mining and related activities.

Marathon Digital Holdings operates large-scale Bitcoin mining facilities and has multiple data centers across the United States. These data centers are equipped with high-performance mining hardware designed to mine new Bitcoins by solving complex mathematical problems and participate in maintaining the Bitcoin network.

The company's goal is to become one of the largest and most efficient Bitcoin mining companies in North America. Due to its significant power requirements, Marathon Digital Holdings also focuses on finding sustainable and cost-effective energy solutions.

In the mid-year financial report, Marathon's Chairman and CEO Fred Thiel stated:

"At the end of the quarter, we held $1.137 billion in unrestricted cash and cash equivalents and approximately 12,538 Bitcoins, valued at approximately $380 million as of June 30. While our cash position decreased by $11.2 million from the first quarter, we added 1,072 Bitcoins, valued at approximately $32.7 million as of June 30."

"We made significant progress in the second quarter, significantly increasing our hash rate and efficiency… In the second quarter, we increased our effective hash rate from 11.5 to 17.7 EH/s. By growing our hash rate faster than the rest of the Bitcoin network and increasing our uptime, we also increased our Bitcoin production. In the second quarter, we produced a record 2,926 Bitcoins, accounting for approximately 3.3% of the available Bitcoin network rewards during that period."

However, Marathon's earnings and revenue were lower than analysts' expectations. Currently, Marathon holds approximately 12,964 Bitcoins, valued at approximately $336 million. However, its purchase cost was only $189 million, resulting in a return of approximately 78%.

As of now, Marathon Digital Holdings' stock price is $12, compared to approximately $4.09 at the beginning of the year, showing a significant increase, almost tripling. The stock reached its highest point of $19.88 during the year. The company's current market value is $2.091 billion. This stock price and market value fluctuation may reflect the market's high interest in the company's strategies and performance in Bitcoin mining and cryptocurrency investments. Although there has been some decline from the year's peak, the stock price still shows strong performance compared to the beginning of the year, indicating that investors are optimistic about its long-term prospects. However, considering the volatility of the cryptocurrency market, this stock performance may change at any time.

Meitu

Meitu is a Chinese technology company listed on the Hong Kong Stock Exchange, focusing on developing mobile applications and smartphones. The company was founded in 2008 and is headquartered in Xiamen, Fujian Province. Its most well-known product is the eponymous photo editing and beautification app—Meitu, which has hundreds of millions of users worldwide. In addition to basic photo editing functions, the app also provides various beautification, filters, and AI-driven photo enhancement tools.

In 2010, Meitu established its R&D center, MT Lab, focusing on artificial intelligence and image innovation in areas such as computer vision, deep learning, and computer graphics.

As of December 2022, Meitu's monthly active users (MAU) reached 243 million, with nearly 80 million coming from international markets. These international users are distributed across 22 countries and regions, each with 10 million or more users, including Indonesia, Thailand, Brazil, Pakistan, the United States, Vietnam, Japan, Bangladesh, the Philippines, South Korea, Malaysia, Iran, Mexico, Nigeria, Canada, Turkey, Russia, Myanmar, South Africa, the United Kingdom, and Nepal.

In April 2021, Meitu announced a holding of nearly $100 million in cryptocurrencies. According to the latest financial report in July, Meitu reported holding approximately 940 Bitcoins and 31,000 Ethereum, with total costs of $49.5 million and $50.5 million, respectively. Compared to the 2021 report, Meitu's digital currency assets have decreased by over $40 million. The Bitcoin, with a cost of nearly $50 million, is now valued at only around $24.45 million.

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