Bitdeer and the marginal cost problem in the new mining era

Recent actions by Bitdeer — one of the leading Bitcoin mining companies — have caught the crypto community’s attention. The company has just completed liquidating all Bitcoin holdings in its account, including 943 BTC reserves, to redirect capital. This event is not just a routine transaction but reflects a profound shift in how major mining companies view the industry’s future.

From 2,000 BTC to “Nothing” — What’s Happening to the Largest Miner

Since December last year, Bitdeer has gradually reduced its Bitcoin reserves from 2,000 BTC to zero. This wasn’t an impulsive decision but a deliberate, step-by-step process, demonstrating careful planning at each stage. The mined Bitcoin each week is sold off, leaving no “long-term trust” — a stark contrast to traditional mining operations.

This may seem unusual because Bitcoin miners typically hold a portion of their profits as strategic reserves. But Bitdeer has chosen a different path.

What Is Marginal Cost and Why Does It Decide Miners’ Fates

To understand Bitdeer’s decision, we need to look at the concept of marginal cost — known in the industry as “hashprice.” It’s the profit earned per unit of computational power after deducting electricity, equipment maintenance, and other operational costs.

Today’s industry is more brutal than ever. Mining difficulty increases, marginal costs decrease, and mining companies face mounting pressure. When marginal costs no longer cover normal operations, companies face a choice: continue holding Bitcoin in hopes of price appreciation or sell to maintain cash flow.

Bitdeer chose the latter, but more than that — they sold more Bitcoin than they mined. This is a survival strategy in a context of tight marginal costs.

Two Different Strategies Among Leading Miners

Not all major mining companies follow Bitdeer’s approach. Marathon, a key competitor, still maintains a large Bitcoin reserve. These two companies represent two entirely different philosophies within the same industry.

Marathon believes Bitcoin will continue to appreciate, so they hold most of their mined assets. Bitdeer, on the other hand, views Bitcoin as a raw commodity — a tradable asset that must be sold to generate cash flow. Both perspectives could be right or wrong, depending on what happens next.

The key point is: the mining industry has split into two camps — those who see Bitcoin as a long-term asset, and those who treat it purely as a business. Marginal cost pressures are pushing companies toward the cash-out side.

Repositioning or Desperation — A Message from Bitdeer

Bitdeer isn’t stopping at selling Bitcoin. The company is raising $300 million to refocus capital on three areas: AI infrastructure, data centers, and developing new mining hardware. This isn’t the move of a company abandoning the game but one changing the rules.

The reason is clear: instead of relying on Bitcoin’s price for profit, why not build infrastructure that can be profitable regardless of market conditions? This is a strategic turning point — shifting from Bitcoin mining to extracting value from global computational demand.

This change reflects the reality that the “easy mining” phase is over. Companies that want to survive must evolve, finding ways to create value beyond simply converting electricity into Bitcoin.

When Marginal Cost Becomes the Deciding Factor

The Bitcoin mining industry is undergoing a natural selection. Those with low marginal costs — large companies with cheap electricity and optimized technology — will survive. Those with higher costs will be eliminated. Despite being a major player, Bitdeer has realized that just mining Bitcoin is no longer enough to ensure stable profits.

This also means smaller miners with higher marginal costs will struggle. They may be forced to sell Bitcoin to pay electricity bills or shut down altogether. The market will become more concentrated, with larger, cost-efficient firms maintaining dominance.

From a broader perspective, Bitdeer’s move could be seen as a final signal — not about Bitcoin’s price, but about the industry’s business model. The easy phase is over. Now, those who manage marginal costs wisely will be the ones who survive.

With this bold decision, Bitdeer sends a clear message: marginal cost is king, and those who fail to adapt will be left behind. Whether they are right or wrong, time will tell.