Marathon Digital (MARA) has one less bull on Wall Street after BTIG's Gregory Lewis downgraded the stock from buy to neutral following Compute North's bankruptcy filing.
A crypto mining data center provider, Compute North is the primary host for Marathon's mining rigs, noted Lewis in a note to clients, and the upcoming restructuring is likely to slow Marathon's hash capacity growth in the near-term.
There's some good news over a longer time frame, said Lewis, as Compute North's bankruptcy may give Marathon a chance to build a data center infrastructure footprint at “distressed pricing.” Lewis also expects that current hosting contracts will be renegotiated.
For its part, Marathon Tweeted late Thursday that the bankruptcy protection filings won't affect current mining operations and that the company is in communication with Compute North.
Marathon Digital shares are down 5% early on Friday as the downgrade combines with lower markets in general and another decline in bitcoin (BTC) to below $19,000.