Riot Platforms shares drop 9% after Kerrisdale Capital shorts bitcoin miner
Kerrisdale calls bitcoin mining one of the worst business models for a public company, as the industry has unpredictable revenue, high competition and intense regulatory scrutiny.
“Today, we launch a war against bitcoin miners, an industry of snake oil salesmen that are incinerating both investor capital and the environment and should be banished from America much like the Chinese RTO frauds that we helped kick out a decade ago,” Kerrisdale posted on social media platform X.
Reuters could not independently verify the allegations.
Riot Platforms did not immediately respond to a Reuters request for comment. Kerrisdale believes the introduction of low-fee bitcoin ETFs is more beneficial to investors over owning shares of a company such as Riot, which has seen a steady decline in bitcoin holding and production per share. “Riot is a fundamentally poor way for investors to express a view on bitcoin and over the long term, shares have a much greater chance of being diluted into dust than outpacing gains from the new digital gold,” the investment firm added in their report. The U.S. Securities and Exchange Commission, which is led by crypto skeptic Gary Gensler, approved bitcoin ETFs in January after Grayscale Investments won a court challenge last year.
Bitcoin is up about 60% so far this year.
