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Bitcoin (BTC) mining analyst Jaran Mellerud estimated that the Ethereum (ETH) merge might have led to a 40% drop in Hive Blockchain’s revenue.
Hive just lost its ether mining cash cow.
I estimate its revenues to have fallen by 40% due to "the merge". pic.twitter.com/1vq0U6EUze
— Jaran Mellerud (@JMellerud) December 5, 2022
Mellerud highlighted that the mining firm’s ETH business was more profitable than its Bitcoin activities, meaning the merge event could lead to a 60% loss in its operating cash flow.
Hive pivots to ETC and Bitcoin mining
The firm has started mining Ethereum Classic (ETC) to remedy the loss. But its main focus is to repurpose its Ethereum mining facilities for BTC mining and increase capacity from 2.8 EH/s to 3.3 by February 2023.
With the miner now looking to go into sustainable Bitcoin mining, Hashrate Index examined its finances to see if it can make this move.
Hive finances remain strong
According to Hashrate Index, the company’s balance sheet looks relatively stable, with only $26 million in interest-bearing debts. This means the company does not have to spend so much on debt servicing and can preserve cash flows, which will help its liquidity.
In overall liquidity, the firm has one of the lowest debt-to-equity ratios among public miners and has a quick ratio of 3 for its balance sheet liquidity. Only four other public miners in the top 15 by enterprise value have a more liquid balance sheet.