American Bitcoin Corp., a mining company backed by the Trump family, was established before the price of Bitcoin plunged from its historical high last year. The company has reported losses for the second consecutive quarter after the value of the Bitcoin it holds declined.
The Miami-based company said in a statement Wednesday that it had a net loss of $82 million in the first quarter, compared with a net loss of $59 million in the three months ended December 31. Revenue declined by about 20% to $62 million, reflecting a lower average revenue per Bitcoin.
Amid the wave of industry-wide transformation into infrastructure providers for artificial intelligence companies, American Bitcoin is one of the few publicly traded companies that still focuses on issuing Bitcoin tokens. After its high-profile listing on Nasdaq in September, the company’s common stock price has plunged nearly 90% from its peak and is currently around $1.25. In after-hours trading, the stock dropped by approximately 1%.
“Adding to our holdings is the most important thing,” said Eric Trump, chief strategy officer of the US Bitcoin company, during a conference call. “We will also continue to increase our reserves by purchasing US Treasuries in a measured way.” The company accumulated about 1,600 bitcoins in the first quarter, increasing its holdings by approximately 30%.
Eric Trump and Donald Trump Jr. both hold shares in the company. The company’s former parent, Hut 8 Corp., spun off its mining division earlier this year and began a transformation to focus on building infrastructure for artificial intelligence applications. After the deal was announced, the joint venture’s share price soared, raising questions from critics about conflicts of interest. The Trump family, however, said there were no conflicts of interest.
As the price of Bitcoin has soared in recent years, Bitcoin mining has evolved from a cottage industry to a multibillion-dollar business. Publicly traded companies have raised tens of billions of dollars to build data centers, purchase expensive specialized computers and acquire vast amounts of energy to support mining operations. These companies were also among the earliest backers of Donald Trump’s most recent presidential campaign.
The largest manufacturer of Bitcoin mining machines is Bitmain, headquartered in Beijing. The company is also a major supplier of Bitcoin in the United States, which may cause a conflict of interest between the Trump family members and this Chinese company. However, the president and his family have stated that there is no conflict of interest.
