Bitcoin miner Marathon Digital is expanding its revenue streams by venturing into mining Kaspa, a proof-of-work (PoW) layer 1 blockchain network.
According to the miner, the decision to explore Kaspa came about in May 2023 after an internal analysis identified opportunities beyond Bitcoin mining. Marathon Digital deployed its first Kaspa mining machine in September 2023.
Since then, the company has mined 93 million KAS tokens, which are currently valued at about $15 million as of June 25. Following this news, KAS, the native asset of the Kaspa network, saw a 9% surge, reaching a multi-week high of $0.18.
Marathon Digital cited several reasons for choosing to mine Kaspa, including its fair launch, advanced technology, growing ecosystem, and high profitability in terms of cost per kilowatt-hour. The company also noted that Kaspa integrates seamlessly with its existing data center sites, requiring minimal reconfiguration.
Additionally, Marathon Digital pointed out that the Kaspa network processes one block per second, potentially allowing miners to earn more block rewards within a given timeframe. This increased profitability opportunity gives the company more operational flexibility and the ability to establish digital asset data centers in regions where Bitcoin mining may not be feasible.
Adam Swick, Marathon’s chief growth officer, emphasized the strategic move, stating, “By mining Kaspa, we are able to create a stream of revenue that is diversified from Bitcoin, and that is directly tied to our core competencies in digital asset compute.”
Looking ahead, Marathon Digital aims to dominate the Kaspa mining sector. The company disclosed the purchase of 60 petahashes of KS3, KS5, and KS5 Pro ASICs from Bitmain, which will enhance its Kaspa mining capabilities.
Marathon Digital highlighted the profitability of Kaspa ASICs, noting that a KS5 Pro can generate around $79 in daily profit, significantly higher than the $11 generated by a BTC-mining S21. These ASICs will be deployed in Marathon’s Texas facilities, with full operation expected by Q3 2024.
Once operational, these machines are projected to contribute to about 16% of Kaspa’s global hash rate. Despite this significant share within the Kaspa ecosystem, it represents only 1% of Marathon’s 1,100 MW data center portfolio.
