Another Quarter in the Red
American Bitcoin Corp., a mining company with ties to the Trump family, started operations last year just before crypto prices retreated from record levels. On Monday it reported another losing quarter - its third in a row - hurt by the declining value of its holdings.
The Miami-based firm lost $57 million, or 80 cents per share, in the second quarter, after losing $82 million in the first three months of the year. Revenue reached $67 million, up from $62 million in the prior quarter.
Eric Trump and Donald Trump Jr. helped found the company. American Bitcoin is unusual among publicly traded miners: it still concentrates exclusively on producing new Bitcoin while many industry peers have shifted toward building computing infrastructure for artificial-intelligence companies.
The company's fortunes are tied closely to the price of Bitcoin because it mines and holds the token rather than diversifying into other businesses. That concentration has made its stock particularly sensitive to swings in the cryptocurrency market.
Holdings and Market Performance
Bitcoin's price slipped 14% during the quarter that ended June 30. On Monday, the token traded at about $63,150 and has fallen roughly 45% over the past year. American Bitcoin expanded its holdings to approximately 8,000 tokens by June 30, roughly 14% more than it held three months earlier.
Get the market news that matters in a five-minute read with Market Briefs, our free daily newsletter
"Bitcoin does not move in a straight line, and we've never built this company assuming it would. We understand the headwinds faced by this industry this year. But our conviction is unchanged," Eric Trump, the company's chief strategy officer, said on a conference call after the results were released.
Even though the company has emphasized more efficient mining and greater computing power, the prolonged crypto downturn has weighed on its stock and shares of other businesses with significant or leveraged Bitcoin exposure. The stock made a widely touted debut in September but has plunged roughly 95% from its peak. As a result, in July the firm consolidated each block of 15 existing shares into a single new one, a move aimed at keeping its shares listed on the Nasdaq. By 9:57 a.m. in New York, the stock had fallen about 3.3% to $5.34.
Eric Trump has argued the company's production costs are low enough to keep its conviction intact, but the stock's slide shows how exposed the business remains to crypto prices.
Digital-Asset Treasury Label
American Bitcoin also belongs to a wave of companies that have described themselves as digital-asset treasury firms, or DATs, after the value of the cryptocurrency jumped following Donald Trump's election to a second U.S. presidential term.
Eric Trump pushed back on that label on the call.
"Where I somewhat get annoyed is that we get lumped in the same bucket with DATs. DATs that are stagnant, DATs that have to go out and buy Bitcoin and other cryptocurrencies at fair market price. Our advantage is that we're not buying at fair market price. Our advantage is that we're mining for roughly $0.50 on the dollar," he said.
Broader Trump Crypto Interests
American Bitcoin is one of several Trump-family crypto initiatives, alongside the DeFi venture World Liberty Financial. Financial disclosures indicate that Donald Trump earned at least $1.4 billion from his crypto ventures last year, making him the top U.S. earner in digital assets.
Join Market Briefs, our free daily newsletter, for a quick daily rundown of the markets
