What happened

Shares of Marathon Digital Holdings (NASDAQ:MARA) surged sharply higher Wednesday, jumping as much as 13%. As of 1:26 p.m. ET, the stock was still up 6.5%

The catalyst that sent the Bitcoin (CRYPTO:BTC) mining specialist higher was the announcement of an expanded hosting agreement with Compute North.

So what

Marathon Digital announced in a press release that it had extended its agreement with Compute North to accommodate 30,000 more Bitcoin miners in different regions of the U.S. Compute North, which provides data center and other infrastructure services, will now host more than 100,000 of Marathon Digital's Bitcoin mining rigs. 

Two young professional looking at a laptop in a data center.

Image source: Getty Images.

Some of the miners will be deployed at existing data centers, with the remainder coming online by mid-2022 once Compute North completes construction of its new facilities. Compute North "will be developing and operating the new mining facilities as well as managing the deployment of Marathon's miners," according to the release.

The underlying power will be provided primarily by wind and solar farms, making Marathon Digital even more environmentally friendly.

Now what

This is an important development for Marathon Digital Holdings, as its mining operations will "not only be among the largest in North America, but also among the most efficient and most environmentally friendly," according to CEO Fred Thiel. He went on to say that since Marathon's primary energy provider is one of the largest generators of renewable energy in North America, "we now have a clear path to continue expanding our mining operations with renewable power in the United States."

In fact, once the full deployment is complete, the deal will make Marathon's mining operations roughly 77% carbon neutral, which will be a boon to those concerned about the growing power consumption resulting from cryptocurrency mining.

Marathon also said that once all 133,000 of its Bitcoin miners are operating, its hash rate will be approximately 13.3 EH/s and its blended cost of electricity and hosting will be approximately $0.042 per kilowatt hour (kWh). For context, that cost is roughly 16% lower than the estimated average of $0.05 per kWh. 

The news gave investors several reasons to cheer.

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