In spite of holding a record amount of Bitcoin, MARA Holdings, a company engaged in cryptocurrency mining, reports a substantial Q1 loss of $533 million.

In a Nutshell

MARA, a Bitcoin miner, reported a whopping $533 million net loss in Q1 2025, despite a 30% revenue growth and massive Bitcoin holdings growth.
A substantial $510 million negative adjustment in the fair value of its Bitcoin holdings, due to Bitcoin's price dip, primarily caused the losses.
MARA adopted new crypto accounting standards in 2023, recording changes in the fair value of digital assets directly in its net income, resulting in paper losses.

Meet the Scene

On a disappointing Thursday, MARA Holdings, a renowned Bitcoin miner, reported a staggering $533 million net loss for Q1 2025, despite achieving record Bitcoin accumulation and revenue growth.

The company's financial statement demonstrated a 30% increase in revenue to $214 million, with its Bitcoin stash swelling to an impressive 47,531 BTC, a significant upward trend from 17,320 BTC a year ago.

Yet, MARA's figures missed Wall Street's predictions, with the net income loss ballooning to $533 million (or $1.55 per share) from $337 million (or $1.26 per share) in the previous year.

CEO Fred Thiel spelled it out in a letter to shareholders, "We are a company focused on growth, but not at any cost. We aren't chasing an arbitrary number."

In spite of nearly tripling its Bitcoin stash, the bottom line took a major hit.

During the same period, MARA's Bitcoin production dropped by 19% year-over-year to 2,286 BTC in Q1 2025, primarily due to the Bitcoin halving last year that chopped mining rewards.

However, MARA sees Bitcoin as "the most optimal macro hedge in uncertain environments," Thiel claimed. As the company aims to evolve into a vertically integrated digital energy and infrastructure firm, this belief becomes even more crucial.

Decrypt reached out to MARA Holdings for further comment.

Losses on Paper

MARA's hefty quarterly loss was primarily due to a $510 million hit related to the fair value of its Bitcoin holdings, as Bitcoin's price slid from $93,354 to $82,534 during the quarter.

The new cryptocurrency accounting rules, approved in 2023, have also altered how MARA reports its Bitcoin holdings. Instead of using the earlier cost-less-impairment model, the company now bases its crypto assets on fair market value at each reporting period's end. Any fair value changes directly impact its net income, leading to paper losses but remaining non-cash charges.

The company boasts a robust liquidity position, with $196 million in cash and an astounding $4.1 billion in combined cash and digital assets, per its consolidated balance sheet.

Thiel explained, "Staying committed to our strategy will, over time, generate greater value for our shareholders."

Penned by Sebastian Sinclair

Enriched Insights

Post 2023, MARA Holdings implements specific changes to its accounting treatment for Bitcoin holdings and other digital assets, as per Accounting Standards Update (ASU) 2023-08. The changes include:

Recording Fair Value Changes: Instead of the earlier impairment model, MARA now measures its digital assets, including Bitcoin, at fair value. Any changes to the fair value of these assets are recognized directly in the Condensed Consolidated Statements of Operations (income statement), adhering to guidance under ASC 350-60 (Intangibles - Goodwill and Other - Crypto Assets)[1][2].
Digital Asset Classification: Bitcoin held for long-term investment ("HODL" strategy) is classified as non-current assets on MARA's balance sheet. This reflects MARA's policy to hold all mined Bitcoin and potentially buy more strategically while maintaining it long-term[1][2].
Cost Basis Tracking: MARA tracks the cost basis of its digital assets using the first-in-first-out (FIFO) accounting method.
Cash Flow Presentation: Proceeds from sales of digital assets are reported within investing activities in the statement of cash flows, emphasizing these as investment transactions rather than operating cash flows[1][2].

These changes align MARA's crypto asset accounting with the Financial Accounting Standards Board's updated requirements, focusing on transparency and fair value measurement for crypto assets[3].

In essence, post 2023, MARA holdings:

Record Bitcoin and other digital assets at fair value with earnings impact.
Classifies Bitcoin held for long-term investment as non-current assets.
Tracks cost basis on a FIFO basis.
Distinguishes loaned or collateralized digital assets as long-term receivables.
Reports digital asset sales in investing cash flows[1][2].

These changes reflect MARA's formal "HODL" treasury approach and comply with ASU 2023-08 and ASC 350-60 accounting standards[1][2].

The staggering $533 million net loss reported by MARA Holdings in Q1 2025 was mainly due to a $510 million negative adjustment in the fair value of its Bitcoin holdings, as a result of Bitcoin's price dip.
Despite this loss, MARA's revenue increased by 30% to $214 million, with its Bitcoin stash growing significantly to 47,531 BTC.
The new cryptocurrency accounting rules, implemented by MARA in 2023, directly impact its net income by recording changes in the fair value of digital assets, such as Bitcoin, leading to paper losses.
MARA Holdings boasts a robust liquidity position, with $196 million in cash and an astounding $4.1 billion in combined cash and digital assets.
In spite of the losses, MARA remains committed to its strategy of holding Bitcoin as the most optimal macro hedge in uncertain environments, aiming to evolve into a vertically integrated digital energy and infrastructure firm.

In spite of holding a record amount of Bitcoin, MARA Holdings, a company engaged in cryptocurrency mining, reports a substantial Q1 loss of $533 million.