Bitcoin mining company Hut 8 (HUT) has taken the ambitious step of purchasing 990 Bitcoins, making an investment of approximately $100 million at an average price of $101,710 per coin.
This new acquisition increased Hut 8’s total Bitcoin reserves to 10,096 BTC, worth around $1 billion, and put the company in the top 10 among Bitcoin holders.
The Miami-based company plans to use its Bitcoin reserves through various strategies, including options, commitments and sales. Hut 8 CEO Asher Genoot said, “Today, the market recognizes and values our strategic reserve, which effectively lowers our cost of capital and strengthens our financial position.” Genoot also stated that the company plans to purchase more Bitcoin when market conditions become favorable.
The purchase comes after Hut 8 recently launched a $500 million intra-market issuance program for BTC purchases and other investments. Other miners have started to follow similar strategies. Riot Platforms (RIOT) purchased 667 Bitcoin at an average price of $101,135 on Dec. 16, while MARA Holdings (MARA) is also actively buying BTC in order to strengthen its financial position.
These strategies have proven to be an effective solution for miners struggling with shrinking profit margins post-Bitcoin halving. For example, MARA raised $1 billion in convertible debt last month, giving investors exposure to BTC equity instead of traditional interest income.
Hut 8 sees its Bitcoin reserve as more than just a store of value. “We view our strategic reserve as a dynamic financial asset that goes beyond simple price appreciation and as a tool that can generate returns in the future,” CEO Genoot said.