DCG Launches Fortitude Mining, Diversifying Crypto Asset Exposure

Digital Currency Group (DCG), a capital markets company, has spun out a new cryptocurrency mining subsidiary, Fortitude Mining. This move signals DCG's intent to provide institutional exposure to a diversified pool of mined crypto assets. The new subsidiary was announced on Jan. 29 via the X social media platform and is now a standalone mining business, previously operating as part of Foundry, a decentralized mining and staking service.

Andrea Childs, who joined Foundry in 2020, has been appointed as the CEO of Fortitude Mining. The financial details of the acquisition were not disclosed. The spinout of Fortitude Mining may have been part of Foundry's broader restructuring plan, as the company laid off 16% of its US workforce in December to focus on its core Bitcoin (BTC) mining operations.

Foundry currently operates the largest Bitcoin mining pool, accounting for more than 30% of the network's hashrate. This is significantly higher than China's Antpool, which holds a 17.8% share. The Bitcoin mining industry has faced renewed challenges following the network's fourth halving event in April 2024, leading to industry consolidation and diversification strategies among miners.

Galaxy Digital calculated $460 million in reverse mergers and acquisitions in the first six months of 2024, forecasting further industry consolidation in the year ahead. Architect Partners also identified an M&A surge among Bitcoin miners, with large companies seeking to boost data center capacity and access cheaper energy resources. Publicly traded miners have diversified their business post-halving, with companies such as MARA Holdings, Riot Platforms, and Hut 8 choosing to build up a bigger Bitcoin stockpile.

A report by Digital Mining Solutions and BitcoinMiningStock.io noted a shift among Bitcoin miners in 2024, with many opting to retain a larger portion of their mined Bitcoin or refraining from selling altogether. The report also highlighted that four of the 16 largest Bitcoin holders are miners.