Crypto winter, a superb moment for M and A: White Rock CEO

Andy Long, the CEO of White Rock, recently told Cointelegraph that the crypto market downturn offers fantastic M&A possibilities.

Long believes that the current market conditions, often referred to as a “crypto winter,” are ripe for M&A activity. Because many companies are struggling and looking for ways to survive. He says:

“In terms of M&A opportunities, I think it’s a great time. A lot of companies are struggling, and a lot of companies are looking for ways to survive. I think there’s going to be a lot of consolidation in the industry over the next 12 to 18 months.”

Long adds that White Rock is doing well, and its financial condition is excellent, even if there is more volatility ahead. He says;

“The bear market has presented difficulties for miners who levered up at the top of the market, however, the industry has before, and well-capitalized and efficient miners will be just fine.”

The White Rock CEO adds that the proceeding crypto winter would provide excellent merger and acquisition chances. For firms with a net positive balance sheet. Long says;

“Bear markets provide excellent possibilities, so we anticipate M&A and consolidation in the mining sector from both public and private participants to achieve economies of scale and integrate complementary operations. We’ll also see network development pick up again, not to the extent that we were at the end of last year, but we will be at least 20% higher by year-end.”

Following China’s prohibition on bitcoin mining last year, the United States has become the planet’s most prominent bitcoin mining nation. The U.S. now accounts for about 30% of the global hash power, with Canada and Iceland also playing a big role in global mining.

As the leading country in cryptocurrency mining, the U.S. is also home to some of the world’s largest mining companies. Including Bitmain, which operates three large-scale mines in the country.

While the bear market has forced many small miners out of business. It has also created an opportunity for larger companies to increase their market share.

In an interview with Bloomberg, Fred Krueger, CEO of White Rock Capital says that. The current bear market is a “superb moment” for M&A in the cryptocurrency industry.

The recent heatwave did not appear to have had a significant impact on the Texas mining sector, according to Long.

He explained the successful collaboration between the cryptocurrency sector and ERCOT. Which manages the state’s electricity grid, and has helped resolve energy scarcity problems in recent months. He says;

“There’s a lot of activity in Texas, and the mining industry is in excellent condition. Grid-connected miners are working with ERCOT to provide demand response during harsh weather conditions, and we expect continued growth throughout the state.”

Over the previous six weeks, the cryptocurrency market has been growing steadily, with the overall market cap nearing $1.2 trillion. The strong performance of the market has led to an increase in M&A activity. As companies look to consolidate their position or expand their reach.

According to data from Dealroom, the value of blockchain and cryptocurrency M&A deals in 2020 reached $4.3 billion. More than double the $2 billion recorded in 2019.

Most of these deals happened in the U.S., where $2.7 billion worth of deals took place. Asia came in a distant second, with only a fraction of the deals taking place there.

One of the most active acquirers in the space has been Binance, which made 14 acquisitions in 2020 alone. The most recent was its $400 million purchase of Indian cryptocurrency exchange WazirX.

Binance CEO Changpeng Zhao has said that the company is on the lookout for more acquisitions, particularly in the U.S.