Marathon Digital Holdings Announces Updates on Bitcoin Production and Mining Operations for March 2022

Marathon Digital Holdings, Inc.

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Historical and potential hash rate growth based on current delivery schedules of previously purchased miners (subject to change)

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Total network hash rate

The Company produces a record 1,259 BTC in Q1 2022, a 556% year-on-year increase from Q1 2021 and a 15% sequential increase from Q4 2021
– Total bitcoin holdings increase to 9,374 BTC
– Hash rate is up 14% sequentially with deployments expected to increase in the coming weeks as the approval and approval process is completed

LAS VEGAS, April 4, 2022 (GLOBE NEWSWIRE) — Marathon Digital Holdings, Inc. (NASDAQ:MARA) (“marathon” or “enterprise”)one of the largest Bitcoin self-mining companies in North America, today released unaudited updates on Bitcoin (“BTC”) production and miner deployment for March 2022.

Historical and potential hash rate growth based on current delivery schedules of previously purchased miners (subject to change)

Marathon Digital Holdings, Inc.

Company highlights as of April 1, 2022

• Produced a record 1,258.6 self-mined bitcoins in Q1 2022, a 556% increase from 191.8 self-mined bitcoins in Q1 2021 and a sequential 15% increase from 1,098.2 self-mined bitcoins in Q4 2021

• Bitcoin production in the first quarter of 2021 would have increased by 17% qoq to 1,281.5 BTC, keeping the global hash rate constant from December 31, 2021 to March 31, 2022

• Produced 436.1 self-mined bitcoins in March 2022, a 21% increase from the 360.4 self-mined bitcoins in February 2022

• Increased total bitcoin holdings to approximately 9,373.6 BTC with a fair market value of approximately $427.7 million

• Cash on hand was approximately $118.5 million and total liquidity, defined as cash and bitcoin holdings, was approximately $546.2 million

• In March, 1,320 miners were successfully deployed

• Increased hash rate by 14% in Q1 2022 from Q4 2021

• Received about 5,600 S19 ASIC miners from BITMAIN in March

• The existing mining fleet consists of 36,830 active miners producing approximately 3.9 EH/s

• Upon receipt of final permits and regulatory approval, miners are currently expected to be powered up in the coming weeks and deployment to accelerate for the remainder of 2022

• The Company continues to expect its mining operations to be 100% carbon neutral by the end of 2022

The story goes on

Bitcoin production update
Year-to-date, Marathon’s mining fleet has produced 1,258.6 Bitcoin, a 556% increase over the same period last year. On a monthly basis, the company’s bitcoin production was as follows:

Marathon Digital Holdings, Inc.

*Note: Upgrades and maintenance at the Hardin, MT power plant resulted in Marathon’s Hardin, MT bitcoin mining operation operating at significantly reduced capacity in November 2021, adversely affecting the Company’s bitcoin production for the month month affected. For more information, see the press release dated December 3, 2021.

Overall Network Hash Rate Source: https://www.blockchain.com/charts/hash-rate

The company last sold bitcoin on October 21, 2020 and since then has collected or “hodling” all the bitcoins generated. As a result, Marathon currently holds approximately 9,373.6 BTC, including the 4,813 BTC the company bought in January 2021 at an average price of $31,168 per BTC. As of April 1, 2022, the fair market value of one bitcoin was approximately $45,539, meaning the approximate fair market value of Marathon’s current bitcoin holdings is approximately $427.7 million.

Miner installations and hash rate growth
Marathon’s current strategy is to deploy its miners mostly behind the meter in sustainable, non-carbon-emitting power plants. In order to maximize the uptime of the Company’s miners, a grid connection will be established at these sites when the renewable power plants are operated intermittently. Setting up this grid connection is a new process that required additional coordination and approvals from the various parties, including the grid operator. This extended permitting process caused Marathon miners’ deployment to be delayed by approximately 45 days in the first quarter of 2022. However, in March the company received word that full approval had been received and that the first power supply is expected in the coming weeks.

Containers are currently being accelerated at Compute North’s new facilities in Texas. These facilities are located at multiple locations and include a 280 megawatt (MW) site in western Texas. Despite minor changes to the early deployment schedule, Marathon still expects to deploy all of its purchased miners by early 2023. At that point, the company’s mining operation is expected to consist of around 199,000 bitcoin miners producing around 23.3 EH/s. Additionally, the Company continues to expect its mining operations to be 100% carbon neutral by the end of 2022.

Management Comment
“In the first quarter of 2022, we increased our bitcoin production by 15% quarter-on-quarter and produced a record 1,259 bitcoin, despite an approximately 17% increase in global hash rate,” said Fred Thiel, CEO of Marathon. “Our Bitcoin production would have increased by 17% to 1,282 BTC if the global hash rate had remained constant as of the end of Q4 2021. We continue to hold all of our bitcoins, or HODL, and as a result we now hold 9,374 bitcoins, reinforcing our standing as one of the largest holders of bitcoin among publicly traded companies.

“At Marathon, we are constantly pushing the boundaries to advance our business and our industry. Not every industry works at the same pace as we do, and sometimes implementing innovative solutions can take time. Deploying behind the meter in renewable energy installations has many benefits for our business, the grid and the local community, but this pioneering approach brings unique challenges that we have had to overcome: most notably, feeding power from the grid back to the grid Large scale power plant.

“Normally, electricity flows from power plants into the grid. However, to ensure that we have a constant power supply when the renewable sources are working intermittently, we also had to allow large-scale electricity to flow back from the grid to the power plant. This is a new process and it is taking longer than originally anticipated for the various parties involved to coordinate and complete the approval and approval process. As a result, the main ramp of our deployments has shifted approximately 45 days in the first quarter.

“Gladly, in March we received word that our hosting provider and energy suppliers had received permission to move forward with our full deployments in earnest. Therefore, we believe these delays are now behind us. Currently, container deployments continue at an accelerated rate. Barring other regulatory hurdles or unforeseen events, we expect new miners to be powered up in the coming weeks and this process to accelerate over the rest of the year. Despite the changes to our schedule, based on what we know today, we still believe we are on track to reach 23.3 EH/s by early next year.

“Our main focus at Marathon continues to be the deployment of our miners. Given our record first quarter, our ability to work with our partners to overcome roadblocks, and the positive news we’ve had recently regarding deployments, we remain confident in our strategy to make Marathon one of the largest agile and most sustainably operated Bitcoin miners in North America can continue to implement.”

Notice to Investors
Investing in our securities involves a high level of risk. Before making any investment decision, you should carefully consider the risks, uncertainties and forward-looking statements described under “Risk Factors” in Item 1A of our most recent Annual Report on Form 10-K for the year ended December 31, 2021. Should any of these risks materialize, our business, our financial condition or our results of operations are likely to suffer. In this case, the value of our securities could fall and you could lose all or part of your investment. The risks and uncertainties we describe are not the only ones we face. Additional risks of which we are currently unaware or which we currently consider immaterial could also adversely affect our business. In addition, our past financial performance may not be a reliable indicator of future performance and historical trends should not be used to predict future results. Future changes in network-wide mining difficulty rate or bitcoin hash rate may also have a material impact on Marathon’s future bitcoin production performance. Additionally, all discussions of financial metrics assume mining difficulty rates as of March 2022. Whole network hash rate data is calculated from a third-party source available here: https://www.blockchain.com/charts/hash-rating. Data from third party sources has not been independently verified. See “Safe Harbor” below.

Forward-Looking Statements
The statements made in this press release include forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements can be identified by the use of words such as “may”, ” will”, “plan”, “should”, “expect”, “anticipate”, “estimate”, “continue” or comparable terms. By their nature, such forward-looking statements are subject to certain risks, trends and uncertainties, many of which the Company cannot accurately predict and some of which the Company may not even anticipate and include factors that could cause actual results to differ materially from those projected or recommended. Readers are cautioned not to place undue reliance on these forward-looking statements and are encouraged to review the factors listed above along with the additional factors under the heading “Risk Factors” in the Company’s annual reports on Form 10-K, as amended, to be reflected or amended by the Company’s Quarterly Reports on Form 10-Q. The Company undertakes no obligation to update or supplement any forward-looking statement that may become untrue as a result of subsequent events, new information or otherwise.

About Marathon Digital Holdings
Marathon is a digital asset technology company that mines cryptocurrencies with a focus on the blockchain ecosystem and digital asset generation.

Marathon Digital Holdings Company Contact:
Phone: 800-804-1690
Email: [email protected]

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