Bitcoin Mining Executive Compensation Faces Shareholder Backlash

Excessive Pay Packages Drive Investor Revolt

Bitcoin mining executives are earning significantly more than their counterparts in traditional IT and energy sectors, prompting widespread shareholder opposition according to recent analysis by VanEck. The asset management firm's research reveals a troubling pattern of excessive compensation that has shareholders fighting back against what they perceive as unfair practices.

Shareholder Approval Rates Hit Historic Lows

The research conducted by VanEck's head of digital assets research Matthew Sigel and investment analyst Nathan Frankovitz shows that average shareholder approval for executive pay packages stands at just 64 percent. This figure represents a stark contrast to the approximately 90 percent approval rates seen among S&P 500 and Russell 3000 companies.

The skepticism appears well-founded as mining executives continue to grant themselves oversized equity awards that dilute shareholders without reliably linking pay to long-term value creation. This disconnect between executive compensation and shareholder value has created significant tension within the Bitcoin mining industry.

Executive Compensation Nearly Doubles in One Year

The compensation analysis covered eight major US-listed Bitcoin miners including Bit Digital, Cipher Mining, CleanSpark, Core Scientific, Hut 8, MARA Holdings, Riot Platforms, and TeraWulf. The findings reveal that while Bitcoin miner executives earned an average of $6.6 million in 2023, this figure has nearly doubled to $14.4 million in 2024.

This dramatic increase far exceeds comparable sectors such as energy and technology, raising questions about the sustainability and justification of such compensation levels within the Bitcoin mining industry.

Equity-Based Compensation Dominates Pay Structure

The compensation structure is predominantly equity-based, with equity awards comprising 79 percent of total pay in 2023 and increasing to 89 percent in 2024. This heavy reliance on equity compensation has created additional concerns about shareholder dilution and alignment with company performance.

Riot Platforms CEO Fred Thiel received the largest equity award at $79.3 million in 2024, nearly double that of MARA Holdings and Core Scientific executives. This award was multiple times larger than equity grants received by other mining company CEOs, highlighting the significant disparities within the sector.

Pay-for-Performance Alignment Shows Stark Disparities

The research revealed concerning disparities in pay-for-performance alignment across different mining companies. While companies like TeraWulf and Core Scientific paid executives just 2 percent of their market cap growth, Riot Platforms paid 73 percent of its market cap increase to named executive officers, totaling $230 million in 2024.

These disparities echo concerns first raised in 2022 when Riot's shareholders rejected the firm's say-on-pay proposal after the company disclosed almost $22 million in CEO compensation. The pattern of excessive compensation has continued to generate shareholder opposition.

Shareholder Revolts Intensify in 2025

In 2025, three of the eight miners faced striking rebukes on their executive pay proposals, demonstrating that shareholder opposition is intensifying rather than diminishing. These rejections represent a clear message from investors that current compensation practices are unsustainable and misaligned with shareholder interests.

The rejection of pay proposals signals a broader shift in investor sentiment, with shareholders demanding greater accountability and alignment between executive compensation and company performance.

Positive Developments in Performance-Based Compensation

Despite the concerning trends, some positive developments have emerged within the industry. Six of the eight miners have adopted performance stock units (PSUs) with multi-year vesting tied to share price targets or relative total shareholder return. Most companies now support annual say-on-pay votes for increased accountability.

Performance stock units represent a type of equity compensation where executives receive company stock only if certain performance conditions are met. This approach helps ensure that executive compensation is more closely aligned with actual company performance and shareholder value creation.

Industry Recommendations for Compensation Reform

VanEck has suggested several recommendations for improving executive compensation practices within the Bitcoin mining industry. These include focusing on tying bonuses to cost per coin mined, incorporating capital efficiency measures like return on invested capital, and strengthening performance requirements for equity awards with multi-year vesting.

The asset manager emphasized that as Bitcoin miners mature into large-scale infrastructure operators, their executive compensation programs must evolve accordingly. This evolution should prioritize shareholder value creation and sustainable business practices over excessive executive enrichment.

Future Outlook for Mining Executive Compensation

The ongoing shareholder revolt against excessive executive compensation in Bitcoin mining companies signals a potential turning point for the industry. As shareholders become more vocal in their opposition to outsized pay packages, mining companies may be forced to reassess their compensation strategies.

The combination of low approval rates, shareholder rejections of pay proposals, and growing investor activism suggests that the current compensation model is unsustainable. Companies that fail to address these concerns may face continued shareholder opposition and potential governance challenges.

The Bitcoin mining industry stands at a crossroads where sustainable compensation practices aligned with shareholder interests must take precedence over executive enrichment. The outcome of this ongoing debate will likely shape the future governance and compensation structures of major mining companies.