How The Bitcoin Bear Market Benefited CleanSpark's Valuation

SummaryCLSK has gained our trust as it kept its promise to achieve 3.2 EH/s capacity back when its capacity was only 0.35 EH/s in Dec 2020.Analysts claim that CLSK is undervalued based on market price to capacity ratio, but we found no such support after considering its expected future capacity and Bitcoin reserves.CLSK's Bitcoin reserve severely trails competitors due to high costs in the past and unwillingness to dilute shareholders, this will subtract CLSK's ability to benefit from a bullish Bitcoin reversal.Bitcoin is now trading below CLSK's cost of sales (electricity + depreciation) per BTC, should Bitcoin fall below the $10,000-$14,000 range, CLSK risks insolvency.We retain our stance to invest in Bitcoin rather than miners.IntroductionCleanSpark (CLSK) is one Bitcoin (BTC-USD) mining company that did not catch our attention but was highly recommended to us by our readers. We were reluctant to cover it because its capacity was too low to be taken seriously. Less than 2 years ago, its capacity was only 0.315 EH/s with promises to bring it up to 3.2 EH/s by 2022Q3. This is a promise to grow 10x in 8 quarters.Was CLSK's 3.2 EH/s capacity by 2022Q3 achievable? Absolutely. The guidance aligns with MARA and RIOT's historical QoQ capacity growth rate, which is 0.4 EH/s. The issue is history taught us that these capacity targets are often pushed back or downgraded. For instance, MARA targeted 10.37 EH/s in CY2021Q1 by early 202...