Key Takeaways
- Bitcoin mining stocks surged following multiple takeover offers.
- Riot Platforms and CoreWeave initiated significant takeover bids.
- Analysts believe undervalued stocks and power contracts could spur more mergers.
Bitcoin mining stocks outperformed other Bitcoin-related stocks on Thursday, driven by multiple takeover offers that have sparked speculation about potential mergers in the industry.
Miners such as Stronghold (SDIG), Core Scientific (CORZ), and TeraWulf (WULF) saw their shares surge over 15%. Meanwhile, Iris Energy (IREN), Mawson (MIGI), Cathedra (CBIT), and Argo Blockchain experienced gains exceeding 10%.
Most notably, Riot Platforms (RIOT) launched a hostile takeover bid for Bitfarms (BITF), and artificial intelligence firm CoreWeave proposed acquiring CoreScientific. Although both offers were rejected, they highlighted the potential for mergers in the sector.
B. Riley analyst Lucas Pipes noted that attractive power contracts and undervalued stocks could catalyze a consolidation phase for miners. Pipes wrote in a report:
We believe that the bullish outlook on the power market could catalyze increased M&A activity this year, especially as wide discrepancies in valuation remain.
JPMorgan analysts echoed this sentiment, suggesting that AI and cloud computing firms looking to diversify their power sources might target Bitcoin miners. The bank also noted that the recent Bitcoin halving, which reduced mining rewards and pressured weaker firms, could further drive merger activity.
Both Wall Street firms indicated that larger miners like Riot and Marathon Digital (MARA) are well-positioned to lead this wave of consolidation.
