MARA Lends Bitcoin to Generate Yield, Expands Holdings

MARA lends Bitcoin to third parties for yield while expanding its holdings, generating income to offset operational expenses in 2024.

MARA, one of the largest publicly traded Bitcoin mining firms in the U.S., has lent 7,377 BTC to third parties. This is roughly just about 16% of its total Bitcoin reserves. The company notes that these loans are short-term arrangements with known third parties. The goal is to make yield so that it offsets operating expenses.

MARA revealed in a production update that it mined 9,457 BTC and purchased 22,065 BTC in 2024. The average purchase price was $87,205. The company’s total Bitcoin reserves had reached 44,893 BTC by December 31. It meant that, at that time, these holdings were worth about $4.4 billion.

The third parties that MARA then lent Bitcoin to were not disclosed. The loans are short-term and done through well-known, established third parties, Robert Samuels, the company’s Director of Investor Relations, mentioned. The company has actively lent Bitcoin throughout 2024 and earns a modest single-digit yield on these arrangements.

MARA Bitcoin Lending Attracts Interest Amid Market Weakness

Samuels explained the lending program on social media, saying it is a brief arrangement with trusted third parties. The company’s aim is finally to be able to generate enough yield to cover operating costs for the long term. MARA’s BTC lending program has attracted a large amount of interest, perhaps partly because of the meltdown of other Bitcoin lenders like BlockFi and Celsius in the 2022 bear market. They revealed that such investments were risky endeavors for depositors. 

MARA has also increased its Bitcoin holdings in addition to lending. With proceeds from a recent zero coupon convertible note offering, BCGP acquired 11,774 BTC in the range of $1.1 billion in USD value. It bought this Bitcoin for $96,000 per Bitcoin, on average.

In Q3 2024, MARA received $3.9 million in interest income, mostly from its cash balance and Bitcoin loans. Earlier filings didn’t mention income from loaned Bitcoin, but in the first half of 2024, it had earned $4.8 million in interest.

Overall, MARA is expanding bitcoin reserves; it is also exploring a way to make money lending bitcoins to other parties. It seems the company’s strategy is on both growing its holdings and earning yield in order to cover its operational costs.