Bitcoin Stockpile Gets Bipartisan Support |Crypto’s Biggest Public Miner Goes After AI

Election betting could go mainstream in the U.S., as Kalshi triumphs over the CFTC.

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Nina Bambysheva Staff Writer, Forbes Money & Markets
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Steven Ehrlich Director, Forbes Digital Assets
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BITCOIN MINER HAS HAD ENOUGH WITH AI THEATER

The stock prices for pure-play bitcoin miners like MARA, Riot Platforms and CleanSpark are down an average of 34% in 2024 while bitcoin is up 45%. Miners that have made direct overtures to the AI space like Core Scientific, Terawulf, Applied Digital and Iris Energy are up an average of 127% year to date. MARA is down 32% on the year. In an exclusive interview with Forbes, Chairman Fred Thiel expressed doubts about the sustainability of these efforts and claimed that MARA’s global footprint and unique power generation capabilities will allow it to ride the AI wave in a way that is complementary to its business.

He also shares key details about his firm’s engagement with both the Trump and Harris campaigns, why his firm has chosen to mine its first asset beyond bitcoin, Kaspa (even if he has questions about the asset’s long-term viability), and why MARA has resumed its HODL strategy of holding onto every bitcoin it produces.

CRYPTO VENTURE CAPITAL READIES A COMEBACK

After a sluggish 2023, crypto venture capital is slowly bouncing back. As of July 2024, more than $2.2 billion has been raised across 24 funds, according to data from PitchBook, putting the market on track to surpass last year’s $2.6 billion total. “We’ve seen an upward trend quarter over quarter for the last three,” says Robert Le, a senior analyst at PitchBook. “I still think we’re somewhat in a capital-constrained environment. Typically, venture investments in crypto follow the performance of publicly traded tokens. In March of this year, the market recovered to 93% of its previous cycle’s peak in total market cap. However, we’re still far from seeing the same level of venture capital investment as before, particularly the $30 billion raised in the last cycle.

As the market recalibrates, investors are eyeing specific sectors poised for growth. Infrastructure, particularly within the Solana ecosystem, is seeing renewed interest. “Solana is taking market share from Ethereum and others,” says Matthew Graham, founder and managing partner at Ryze Labs (formerly Sino Global Capital). “We’re going to see more consumer-facing apps with real product-market fit emerge, and Solana’s technology is well-positioned to support that shift.” Venture capitalists are also excited about DePINs (decentralized physical infrastructure networks) that coordinate machines and devices like Helium, a blockchain-based wireless network; and blockchain-based networks that try to replicate the capabilities of artificial generative intelligence models from the likes of OpenAI and Anthropic.

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CURRENT PRICE OF TOP 5 COINS (7-Day % Change)

Coin

Price

Percent Change

Bitcoin (BTC)

$62,234

6.2%

Ether (ETH)

$2,427

10.8%

Tether (USDT)

$1.00

0.0%

Binance Coin (BNB)

$556

9.2%

Solana (SOL)

$144

9.4%

Sources: Forbes Digital Assets, CoinGecko. Prices as of 3 p.m. on October 4, 2024.

NATIONAL BITCOIN STOCKPILE GETS BIPARTISAN SUPPORT

The narrative around a national strategic stockpile of bitcoin became a prominent topic of conversation in July when Donald Trump made the idea a key part of his speech before a large bitcoin crowd at a conference in Nashville, over the summer. Additionally, a few plans have been proposed, with little immediate effect.

Wyoming Senator Cynthia Lummis, a long-time friend of the industry, unveiled legislation at the same event to create a strategic bitcoin reserve by using existing funds at the Federal Reserve and the Treasury Department to purchase 1 million bitcoin. The move would cement the United States’ position as the largest nation-state holder of bitcoin, granting it 5% ownership of the entire network—on par with the country’s stake in the global gold supply. At the time, she called the stockpile “our Louisiana purchase moment.”

Now, support for a strategic bitcoin reserve has now crossed party lines. In a recent episode of the Unchained Podcast, Democratic Representative Ro Khanna, threw his support behind the idea: “We want to make sure that we have the openness to having bitcoin as part of the Federal Reserve and as a reserve asset because of its potential for appreciation and because of its potential to allow America to set the financial standards.”

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