Great Caution Against Marathon Digital

MARA's outsized compensation to its management such that it can exceed its total revenue or contribute to more than 90% of MARA's expenses should deter prospective investors.MARA is officially making losses for every Bitcoin mined. According to the 2022 Q1 cost structure, MARA is losing $10,000 for each Bitcoin mined at a $21,000 Bitcoin.As a result, we believe MARA is at risk of becoming insolvent. According to the 2022Q1 report, MARA risks depleting its cash and Bitcoin reserves by end of 2023.According to the Bitcoin halving cycle, Bitcoin could fall as low as $10k which will triple MARA's loss per Bitcoin mined.We find that MARA isn't investable at the moment due to the outsized downside risk of being insolvent before the next bull round in May 2024 after the halving event.