How does the capital gearing ratio affect the profitability of cryptocurrency mining?

1 answers

• Horowitz HealyFeb 02, 2022 · 3 years ago
  The capital gearing ratio is a financial metric that measures the proportion of a company's capital that is financed by debt. In the context of cryptocurrency mining, this ratio can have a significant impact on profitability. A high capital gearing ratio indicates a higher level of debt financing, which can increase interest payments and reduce profitability. On the other hand, a lower capital gearing ratio provides mining companies with more financial flexibility and can lead to higher profitability. It's important for mining companies to find the right balance between debt and equity financing to optimize their capital gearing ratio and maximize profitability.
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