Crypto Mining Margins Under Pressure; Tax Planning Becomes Key Strategy

In accordance with Jinse, Marathon Digital Holdings (MARA) and Riot Platforms (RIOT) have both announced strategic shifts in response to shrinking profit margins in the crypto mining sector. MARA revealed in its Q3 2025 earnings report that it will sell part of its newly mined Bitcoin to support operational cash flow. RIOT, in its October 2025 production update, reported a 2% quarterly and 14% annual decline in Bitcoin output and sold 400 BTC, marking a departure from its long-held HODL strategy. The industry faces intensified competition, with Bitcoin prices near $81,000 and hash rate costs exceeding production values, pushing even the most efficient miners to break-even levels. As a result, tax planning is increasingly seen as a critical tool for sustaining operations. In the U.S., tax structures such as pass-through entities and C corporations affect how mining profits are taxed, with C corporations facing double taxation on dividends. Tax optimization strategies, including accelerated depreciation under the One Big Beautiful Bill Act, cross-border structuring, and mining equipment leasing models, are being explored to reduce tax burdens and improve cash flow.