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By Meg Flippin Benzinga
Bitcoin, blockchain and digital tokens are having a moment, and President-elect Trump is a big part of the reason.
Ever since Trump won the U.S. presidential election, Bitcoin prices have soared. On the day of Trump’s victory, Bitcoin hit a new high of $75,358, and it hasn’t looked back, hitting $100,000 in December 2024 and recently hitting an intra-day high of $102,750. Bulls predict a continued rise in price after Trump takes office. The euphoria around Trump’s win lifted the overall crypto market as optimism grew that there would be a more favorable cryptocurrency policy with the new administration, with analysts at one Wall Street investment bank putting the odds of Trump creating a Bitcoin reserve in 2025 at 60%. These factors have led many market watchers to be optimistic about continued good times for crypto.
All of this has ushered in a new growth cycle for cryptocurrencies, one that BitFuFu (NASDAQ: FUFU), a global leader in Bitcoin mining and comprehensive mining services, is taking advantage of and preparing for with its 1GW Global Capacity Expansion Plan, which the company said will lead the platform and its users to a new era of efficient mining.
BitFuFu’s 1GW Global Capacity Expansion Plan is aimed at adding 1GW of capacity by the end of 2026. To meet that goal, the company has been busy acquiring mining farms, purchasing mining machines and improving the operating capacity of its existing mining farms.
In December, BitFuFu announced that it was evaluating approximately 700 MW of potential projects as it moves toward its 1GW capacity increase goal. As of December 31, 2024, the company had 551 MW of mining capacity and nearly 600,000 registered cloud mining users putting BitFuFu squarely in a global leadership position.
More recently, BitFuFu signed a deal with BITMAIN, the largest digital asset mining hardware manufacturer, to purchase up to 80,000 S-series miners and to rapidly expand mining infrastructure globally with a target of adding 1 GW in capacity by the end of 2026.
Trump’s Crypto Cheerleading
It makes sense that cryptocurrency is having a moment and that BitFuFu could be poised to benefit. In July 2024, Trump announced that he would list Bitcoin as a strategic reserve asset of the United States and since then, the cryptocurrency industry has generally experienced growth. BitFuFu’s stock price and market capitalization of BitFuFu have been on an overall upward trend in the half year following Trump’s announcement. In November, Wall Street firm H.C Wainwright initiated coverage of BitFuFu with a “buy” rating and price target of $7.00.
During the run-up to the election, Trump vowed to make the U.S. the leader in crypto, indicating he preferred regulators that supported minimal regulation of the crypto industry. The incoming president had previously said he would get rid of Gary Gensler, the current Securities Exchange Commission Chairman. Critics blame Gensler for stifling innovation in the crypto market with his hard stance on the industry. Gensler beat Trump to the firing, announcing he would step down on January 20, 2025, paving the way for Trump to name a more crypto-friendly chairman. Congress is also expected to be more pro-crypto under a Trump administration.
All of this is good news for crypto investors, trading platforms and miners like BitFuFu. Under Trump’s presidency, Bitcoin could possibly continue to set record highs, Bitcoin ETFs may lure more everyday investors to the market, and friendlier legislation could spur innovation and growth. This newfound attention could drive demand for digital assets and, thus, move the price of Bitcoin and other cryptocurrencies higher – potentially lifting all the players in the ecosystem.
Leading Global Position in Cloud Mining
BiFuFu reports it is already seeing rapid growth as it cements itself as a leader in the cryptocurrency space.
In BitFufu's December 2024 Production and Mining Operations Update, the company reported that its cloud-mining registered user base has seen remarkable growth. As of December 31, 2024, the number of registered users reached 591,751. Compared with 455,764 as of September 30, 2024, registered users grew nearly 30% over the three-month period. BitFuFu reports that it now leads globally in cloud-mining user scale and growth rate, showing that more users are actively participating in the digital economy.
BitFuFu has been steadily strengthening its capabilities as a mining service platform. Currently, its total hashrate stands at 23.5EH/s with hosting capacity of 551 MW up from 11.1 EH/s and 336 MW at the end of 2022. Additionally, BitFuFu has launched services such as mining pools and software. By integrating miners, hosting, mining pools and software services, BitFuFu provides users with a one-stop mining experience, enabling them to easily participate in the digital economy and share in the profits.
BitFuFu plays a multifaceted role in the crypto mining scene offering a user-friendly mining platform as well as self-mining. As of December 31, 2024, BitFuFu reported that it held 1,720 Bitcoins, one of the largest BTC holdings of any public mining company and positioning it well in the evolving digital currency market.
Positioning For Growth
Unlike traditional miners such as MARA Holdings (NASDAQ: MARA) that focus primarily on self-mining and holding BTC, BitFuFu engages in both self-mining and cloud mining, which provides the company with greater flexibility and reduced volatility in an unpredictable market.
The cloud-mining business, in which BitFuFu rents its hash rate to customers for a specified period of time ranging from 30 days to 360 days, provides BitFuFu with a more stable source of cash flow despite the volatility in the price of Bitcoin. This is due to the fact that BitFuFu receives payment up front and effectively locks in revenue at the prevailing price of Bitcoin. So, even if the price of Bitcoin declines, BitFuFu has already been paid. This cash flow fuels the company's development. BitFuFu has adopted a smart strategy to dynamically shift the amount of hash rate allocated between cloud-mining and self-mining. Given BTC's price volatility, rather than hoarding or dumping, BitFuFu sells more hash rate (cloud-mining) when the price of BTC is high and buys or self-mines when the price of BTC is low. This way, BitFuFu reports it adeptly copes with market changes, maximizes overall returns and rides out BTC's bull and bear cycles. The benefits of this strategy seem to be evident based on BitFuFu’s financial results in the past few quarters.
In the third quarter, BitFuFu reported revenue of $90.3 million, up 47.5% year-over-year, and posted adjusted EBITDA of $5.8 million. The quarter marked the first full three months following the Bitcoin halving event in late April, which reduced the Bitcoin block subsidy to 3.125 Bitcoin per block from 6.25, so the quarter was challenging for Bitcoin miners due to the reduced reward.
“I am proud to say that the third quarter of 2024 is the 11th consecutive quarter BitFuFu has generated positive adjusted EBITDA,” said BitFuFu’s Lu. “This consistency demonstrates the profitability and resilience of our business model, regardless of whether the price of Bitcoin is in a bear market or bull market.”
Among mining companies, only two have achieved consistent revenue growth over the past three years: CleanSpark Inc. (NASDAQ: CLSK) and BitFuFu. With Q3 2024 revenue of $90.3 million and a cumulative revenue of $364 million for the first three quarters of 2024, BitFuFu stands as the third-largest mining company globally, following MARA Holdings and Core Scientific Inc.(NASDAQ: CORZ), reports BitFuFu. Both of its larger rivals reported a net loss for Q3 2024.
To boost hash power and cut electricity costs, BitFuFu is aggressively looking for premium power sources to acquire or partner with around the globe for. Here are the latest developments:
Dec. 2024：33 MW Capacity in the U.S.
Oct. 2024: 80 MW mining site in Ethiopia
BitFuFu’s strategic investments in vertical integration, securing long-term hash rate and expanding its geographic footprint seem to be paying off. The company reports it has a strong and growing user base and a leading position in the cloud mining market just as Bitcoin and other cryptocurrencies are expected to take off under incoming president Trump. With its 1GW Global Capacity Expansion Plan underway, BitFuFu plans to lead the platform and its users to a new era of efficient mining.
Featured photo by Scottsdale Mint on Unsplash.
Benzinga is a leading financial media and data provider, known for delivering accurate, timely, and actionable financial information to empower investors and traders.
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