Bit Digital is a company that engages in Bitcoin mining. The companies fully deployed hashrate is 1,920 PH/s. During Q2, Bit Digital began transferring their mining operation out of Asia following the PRC ban of Bitcoin mining. Since the crypto mining ban, $BTBT has been the target of constant shorts resulting in a decline of its share price. In this post I will compare Bit Digital to its public competitors, and show that it is time for a rebound of $BTBT.
Market Capitalizaiton vs Hashing Power (as of Oct/Sept):
$BTBT - 828.92M vs 1,324 PH/s = 0.62
$MARA - 7,190M vs 2,400 PH/s = 3.00
$RIOT - 3,810M vs 2,300 PH/s = 1.66
Market Capitalization vs Plans for growth 2022:
Bit Digital has not announced their planned growth, so I am calculating an approximate growth target based on their power/facility agreements disclosed in their most recent SEC filing.
$BTBT - 828.92M vs 4,000 PH/s = 0.20
$MARA - 7,190M vs 13,000 PH/s = 0.55
$RIOT - 3,810M vs 7,700 PH/s = 0.49
Using these multipliers calculated using MarketCap/HashRate, a price target can be found for $BTBT to show just how undervalued Bit Digital is.
Expected Increase by Current Hashrate:
vs MARA: 3.00/.62= 4.84x
vs RIOT: 1.66/.62= 2.68x
Expected Increase by 2022 Hashrate:
vs MARA: .55/.20=2.75x
vs RIOT: .49/.20=2.45x
The price at the time of writing is $11.99, so that gives a low price target of $29.38 and a high price target of $58.03.
Short Squeeze Potential:
The price of $BTBT is likely being held down by shorts. Short interest as a percent of float is hovering anywhere from 20% to 50% in the past few weeks. This has resulted in the price not increasing along with Bitcoin while its competitors do. Paired with the implied undervaluation of the stock, this creates a massive potential for the price to increase and shorts to be forced to cover.