BIT Mining Analyst on the Sidelines Until Bitcoin Resurgence, Clarity on North American Mining Track Record

H.C. Wainwright analyst Kevin Dede maintained a Hold rating on BIT Mining Limited BTCM.

While acknowledging BIT Mining's bitcoin-related vertical integration and diversification, many companies are just beginning to shift into high gear in North America with little demonstrated execution leading to reassessment in a note titled "Crypto Pool Hack Costing Millions Highlights the Need and Use of Forensic Software."

Last Monday, Hong Kong-based BIT Mining announced the theft of approximately $3.0 million worth of crypto from its subsidiary BTC.com, the group responsible for most of the company revenue through bitcoin mining pool operations.

BIT Mining's statement says the company intends to deploy "considerable resources" to recover stolen funds in an industry plagued by cybercrime.

Last week, an NPR article stated that South Korea's main spy agency, the National Intelligence Service, believes that North Korea alone is responsible for 1, $2 billion in crypto hacked in the past five years. .

In early November, the Chain Bulletin, a crypto newsletter, suggested that up to $3.0 billion had been hacked from crypto accounts this year, so far in October, up from about $3.2 billion last year. The BIT Mining theft was insignificant, considering the scale of the others.

Part of the crypto industry's response is evident in the emergence of several forensic software systems, including one under Dede's guise, Blockchain Intelligence Group (BIG) , owned by BIGG Digital Assets Inc; others include Chainanalysis and Elliptic, each privately operated.

These software packages track transactions across multiple blockchains by discovering the movement of coins and tokens to locate perpetrators via internet addresses.

Dede understands that BIT Mining is embarking on a similar approach in China in hopes of providing more information regarding its offensive and defensive retaliation over the next few days .

New to Dede's coverage universe, the analyst saw the company well-diversified in the bitcoin ecosystem as a mining pool operator, manufacturer of mining machines , bitcoin miner and a multitude of crypto mining platforms.

At this point and as his business expands in North America, Dede remains more comfortable waiting for a resurgence in the bitcoin ecosystem.

Dede also sought a more clearly established North American operating track record as the company's mining equipment is migrated to its new Ohio facility from locations in accommodation in Kazakhstan.

Price Action: BTCM shares traded up 10.60% to $1.59 when last checked on Wednesday.

© 2022 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.