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For other miners, the cost to mine one bitcoin ranges from $7,000 to $11,000. It also represents a huge advantage over rivals. When Bitcoin is trading in the $55,000 range, that's quite a juicy profit margin. With the credits, Stronghold's cost to mine one bitcoin sank to below $3,000. That caused the value of the credits to rocket from about $0.25 each to as high as $20. Last year, the state mandated that utilities had to buy the credits from plants operating within state borders (before they could get them from a plant in any of the 13 states within the PJM grid). That includes mostly renewable energy, but also plants that burn stuff Pennsylvania wants to get rid of, such as solid waste (garbage) and waste coal. That's why the state included waste coal in its rules that force utilities to buy credits for energy produced with sources the state wants to encourage. You see, the state of Pennsylvania is desperate to get rid of the 800 or so piles of waste coal that are not only unsightly but leech toxic chemicals into the area's ground and water. It greatly benefits from special state-mandated credits that reduce its cost to mine Bitcoin and bolster profits.
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And in fact, the waste coal that Stronghold burns - left over from the Keystone State's coal mining heyday - produces 37% more carbon per megawatt than regular coal.īut Stronghold's choice is sound from a business perspective. That may seem an odd choice in these times of heightened awareness of the dangers of carbon emissions. Stronghold runs Bitcoin mining hardware it acquires elsewhere, but it generates its own electricity to run them - by burning waste coal. Stronghold Digital Mining (NASDAQ: SDIG) is a Bitcoin miner based in Kennerdell, Pa. With an initial public offering expected this week - and one that will be featured on Robinhood's IPO Access - a lot of investors will be asking: "Should I buy Stronghold Digital Mining stock?"īefore I can answer that question, let me give you a little background. Save my name, email, and website in this browser for the next time I comment. Sign me up for the Money Morning newsletter Your email address will not be published. Or to contact Money Morning Customer Service, click here. Comment on This Story Click here to cancel reply.