In February 2023, Blockware Intelligence released the pilot version of “Ranking Public Bitcoin Miners” using financial data from mostly the 3rd quarter of 2022. That report caught fire, as it introduced an innovative new framework to quantify the financial health of public miners and calculated a “Miner Score.” This version of “Ranking Public Bitcoin Miners” has been updated to use data from the Q4 10K’s largely released in March 2023.

Blockware Intelligence and the Satoshi Action Fund co-published this Bitcoin Mining Education report. The basics of Bitcoin, Proof of Work, the Bitcoin Mining industry, and more are all covered.

This report outlines a framework to quantify the liquidity, solvency, and profitability of publicly traded Bitcoin miners. It uses methods practiced by traditional financial professionals to quantify the financial health of public miners and calculates a “Miner Score” to rank them based on four critical metrics pulled directly from 10-Q and 10-K fillings.

Bitcoin mining rigs (ASICs) are a special segment of computer hardware that can be priced as a derivative of BTC and time. This report will use the terms rigs and ASICs interchangeably. Historically, the first Bitcoin ASICs depreciated quickly due to next-generation ASICs being multiples more efficient than their predecessor. Over the past few years, ASICs have clearly started to commoditize as technology approaches the limits of what is thermodynamically possible

Humanity is naturally converging on a global Bitcoin Standard due to BTC having unrivaled monetary properties. This Blockware Intelligence Research Report forecasts the future purchasing power of BTC as it becomes the dominant store of value through the demonetization of other asset classes.

Fiat currencies have failed to store wealth across time thus incentivizing humans to use non-cash assets in order to preserve wealth; resulting in some percentage of said asset’s nominal value being a monetary premium. A hyperbitcoinized world will result in BTC absorbing the monetary premium of other asset classes and bringing them down to just their utility value.

With the advantage of dollar cost averaging into Bitcoin by mining, and the potential for capital gains on rig hardware over time established in previous articles, the question turns to maximizing the return for an investment in mining.

Bitcoin mining enables you to earn a Bitcoin “dividend” during high volatility. New-generation mining rigs provide a unique opportunity for investors. Because of the algorithmic supply dynamics in the Bitcoin network (difficulty adjustment), these new rigs enable miners to earn a consistent positive cash flow even in the face of extreme volatility.

Using conservative assumptions, mining Bitcoin outperformed holding Bitcoin through 2021. When most investors think about mining Bitcoin, they forget that Bitcoin mining is not only about generating operating income, but it also involves purchasing a valuable asset - Bitcoin ASICs.