I celebrated my 8th birthday at a campground in Spain. My Dad had taken a sabbatical from the University of Richmond and my family spent over half of 1973 driving around Europe, camping in an orange VW camper.
It was summer when we pulled into a campground somewhere in Finland. Mom was a little irritated after she made camp by herself and started dinner on our little camp stove – Dad had disappeared…
Not long after, we heard the sauna door slam open, followed by the whoops of a group of butt-naked men running down the dock and jumping in the lake…
Yep, mystery solved.
Somehow, within minutes of pulling into our campsite, Dad had befriended the group of Finnish volunteer firemen that lived at the campground, sat in the sauna drinking gin until the heat got too much and they all ran out and jumped in the lake.
Apparently the gin/sauna/lake was a year-round thing — except the firemen cut a hole in the ice on the lake in winter…. It gets pretty cold in Finland…
Winter temps routinely hit -20 and -30 degrees below zero. Electricity demand can hit 15,000 megawatts a day on the coldest days. The country’s population is just 5.8 million…
On a per capita basis, Fins consume 14,300 kilowatt hours of electricity every year.
For comparison’s sake, US per capita electricity use is 12,300 kilowatts annually.
Finland has among the highest electricity demand in the world…with zero oil and natural gas production, it’s no wonder they’re open to some pretty novel ways to stretch their electricity use as far as possible.
Fourty-two percent of their electricity comes from nuclear power – the fourth highest percentage for any country in the world (France is highest at 70%).
But a new source of energy for heating homes is coming from the world’s largest Bitcoin miner — Marathon Digital Holdings (MARA).
Bitcoin Mining is HOT!
Marathon Digital Holdings is a Bitcoin miner. It builds and runs data centers whose computational power is focused on “mining” Bitcoin out of the blockchain.
Marathon owns 44,394 Bitcoin, worth $4.2 billion. That’s the second largest Bitcoin stash of any publicly traded company.
You’re probably aware that data centers generate a lot of heat — cooling a data center’s computers is a significant cost. As much as half of a data centers power consumption can go to cooling.
Marathon has found a novel solution. It’s using the heat from its data center in the Satakunta Region of Finland to heat 80,000 homes.
It’s because of something called “district heating.”
District heating is a heating system that uses a network of pipes that carry heat generated at a central location.
District heating dates to Ancient Rome, that’s how the public baths were heated. In the 1970’s, around the time my dad was getting soused in a Finnish sauna, the Scandinavian System (which uses heavily insulated pipes for efficiency) was being implemented.
So Marathon simply needs a reservoir of water and a pipe to connect to the Scandinavian district heating system and it’s got a way to offset some of its costs. Marathon’s plan to provide heat started in June with 11,000 homes. 6 months later, it’s already up to 80,000.
Bitcoin and AI
You’re probably also aware that data center construction is going gangbusters. And there’s pushback – a lot of communities don’t want them around. Drive through some rural communities between DC and Richmond as I did at Thanksgiving to avoid I-95 traffic and you’ll see the protest signs – “Vote NO on the data center plan.”
Well, the Bitcoin miners like Marathon already have data centers…
It was revealed last week that an activist hedge fund called Starboard Value took a stake in another Bitcoin miner, Riot Platforms (RIOT). The stock jumped 5% because Starboard Value wants Riot to redeploy some of its data center capacity to train AI models for the hyperscalers (Microsoft, Google, etc).
Such a move would give the Bitcoin miners a stable revenue stream while they add to their Bitcoin reserves, and hopefully watch the price of Bitcoin rise.
Marathon is currently valued at $6.7 billion. It has $4.2 billion in Bitcoin at current prices.
Marathon likely mined 8,563 Bitcoin in 2024, worth $817 million. If it can match that pace in 2025, the value of its Bitcoin jumps to $5 billion at the current price.
But throw in a 2025 rally for Bitcoin and maybe some added data center revenue from the AI hyperscalers and it looks like there could be some upside for Marathon shares.
Full disclosure: Hammer owns some Marathon stock. I do not.
Cheers,
Briton Ryle
Chief Investment Strategist
Outsider Club
X/Twitter: https://twitter.com/BritonRyle
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Hammer’s 2025 Predictions
https://www.outsiderclub.com/the-ghost-of-nostradamus-2025-predictions/
My 2025 Predictions
https://www.outsiderclub.com/brits-2025-market-predictions/
Thanks Boomer!
