Marathon Digital Expands Portfolio with $16M Kaspa Mining Investment

Marathon Digital Ventures into Kaspa Mining with $16M Investment

Crypto News- Bitcoin mining heavyweight Marathon Digital announced that it has mined $16 million worth of Kaspa (KAS) — a token designed to address Bitcoin’s scalability issues — since September. The move aims to diversify Marathon’s portfolio beyond Bitcoin.

Higher Margins with Kaspa

In a June 26 announcement, Marathon Digital highlighted the benefits of mining Kaspa, noting the potential for “higher margins” with Kaspa mining machines, which can reach up to 95% in some cases.

“By mining Kaspa, we are able to create a stream of revenue that is diversified from Bitcoin,” explained Marathon’s Chief Growth Officer, Adam Swick. “Marathon was uniquely positioned to mine Kaspa and to capitalize on the higher margins that exist for those who can deploy Kaspa ASICs today.”

Since deploying its first batch of Kaspa miners in September 2023, Marathon has mined 93 million KAS tokens. During this period, KAS tokens surged by 420%, compared to Bitcoin’s 135% increase.

Investment in Mining Equipment

Marathon has invested in approximately 60 petahashes of KS3, KS5, and KS5 Pro ASICs to mine Kaspa tokens. Currently, half of this capacity is operational, with the remainder set to be installed in the third quarter.

Kaspa Mining: A Small Part of the Big Picture

However, Marathon’s Vice President of Investor Relations, Robert Samuels, emphasized that the firm is not shifting its primary focus from Bitcoin.

Let’s not try and spin it any other way. To say we are ‘pivoting’ is wrong and irresponsible.

Marathon’s Overall Mining Performance

Since September, Marathon has mined 9,761 Bitcoin (BTC) — worth $594.9 million — meaning its Kaspa mining operations account for only a small fraction of its total mining revenue. Despite this, KAS tokens rallied 2.4% following the announcement, bringing their price and Marathon’s total KAS stack to $0.172 and $16 million, respectively.

Kaspa’s Unique Architecture

CoinGecko data shows that Kaspa is the fifth largest proof-of-work cryptocurrency with a $4.1 billion market cap. While there are 24 billion KAS tokens in circulation, the supply will be capped at 28.7 billion.

Similar to Bitcoin, Kaspa is a layer-1 protocol that facilitates transfers using its native token, KAS. However, Kaspa uses a Direct Acyclic Graph-derived architecture — “BlockDAG” — where blocks are added to the network simultaneously rather than linearly. This results in a fast block rate of about 1 block per second, significantly faster than Bitcoin’s approximately 10 minutes per block.

Still Not a Bitcoin Competitor

Despite its advanced technology, Kaspa remains far from being a Bitcoin competitor. Bitcoin currently sees between 700,000 and 1 million unique active addresses interacting with the network each day, while Kaspa averages around 20,000.

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