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  • Bitfarms agrees to buy Stronghold Digital for $175M in stock and debt

    Bitfarms agrees to buy Stronghold Digital for $175M in stock and debt

    Bitfarms agrees to buy Stronghold Digital for $175M in stock and debt
    • Bitfarms to acquire Stronghold Digital for $175M in stock and assumed debt.
    • Bitfarms’ stock fell 8%, while Stronghold’s rose 60% following the news.
    • Riot Platforms, holding 19% of Bitfarms, previously attempted a takeover in June.

    In a significant development within the cryptocurrency mining sector, Bitfarms (BITF), a leading Bitcoin mining company, has announced its acquisition of rival Stronghold Digital (SDIG) for $175 million. The deal, which includes $125 million in stock and the assumption of $50 million in debt, marks a strategic move by Bitfarms as it continues to navigate a competitive industry landscape.

    The acquisition terms specify that Stronghold shareholders will receive 2.52 Bitfarms shares for each Stronghold share they hold. This represents a 71% premium based on Stronghold’s 90-day volume-weighted average price on Nasdaq as of August 16.

    The stock-for-stock transaction reflects Bitfarms’ aggressive growth strategy, despite recent challenges and market volatility.

    Giving Stronghold Digital a lifeline

    The deal comes on the heels of Stronghold’s announcement in May that it was exploring strategic alternatives, including a potential sale.

    Stronghold, based in New York, has been actively considering its options in response to the evolving market conditions.

    The acquisition provides Stronghold with a lifeline while enabling Bitfarms to consolidate its position in the market.

    Riot Platforms abandoned Bitfarms takeover bid

    Bitfarms’ move to acquire Stronghold is particularly noteworthy as it comes at a time when the company is also contending with an ongoing approach by Riot Platforms (RIOT).

    Riot, which holds nearly 19% of Bitfarms, previously attempted to acquire the Toronto-based company in June. However, Riot chose to abandon the bid temporarily, opting instead to overhaul Bitfarms’ board of directors.

    This strategic manoeuvre has kept Bitfarms in the spotlight, as Riot’s interest in the company is likely to continue influencing its future actions.

    The market reaction to the acquisition has been mixed, with Bitfarms’ stock dropping nearly 8% in pre-market trading, while Stronghold’s shares surged by about 60%.

    This acquisition underscores the ongoing consolidation within the cryptocurrency mining industry as companies seek to strengthen their positions in a rapidly evolving market.

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  • Riot Platforms wants to buy Bitfarms for $950 million

    Riot Platforms wants to buy Bitfarms for $950 million

    Riot Platforms wants to buy Bitfarms for $950 million
    • Riot Platforms offers $950M to acquire Canadian Bitcoin miner Bitfarms.
    • Bitfarms is facing leadership turmoil amid CEO Geoffrey Morphy’s lawsuit.
    • The merger would create largest publicly listed Bitcoin miner by capacity.

    Riot Platforms, a prominent Bitcoin miner and Bitfarms’ largest shareholder, has made a hostile takeover offer of $950 million for Bitfarms, a Canadian Bitcoin mining company.

    Riot’s buyout offer represents a 24% premium over Bitfarms’ one-month volume-weighted average share price as of May 24, 2024.

    Shareholders to own 17% of Bitfarms after Riot’s takeover

    Riot Platforms, already the largest shareholder in Bitfarms with a 9.25% stake, had initially approached Bitfarms’ board with a private offer on April 22.

    However, following the rejection of the offer, Riot has now taken the proposal public.

    The deal would involve a combination of cash and common stock, with Bitfarms shareholders standing to own approximately 17% of the merged entity.

    Bitfarms’ disputes with former CEO

    The timing of Riot’s bid coincides with a period of transition and turmoil within Bitfarms’ management. The company has been grappling with the departure of its CEO, Geoffrey Morphy, who was dismissed in May amidst a legal dispute.

    Morphy’s abrupt exit and subsequent lawsuit against Bitfarms for breach of contract and wrongful dismissal have raised questions about the company’s leadership stability and governance practices.

    Riot Platforms has seized upon these developments to assert its case for the acquisition, alleging that certain directors, including Bitfarms’ co-founders Nicolas Bonta and Emiliano Grodzki, may not be acting in the best interests of shareholders.

    Riot has pledged to push for the addition of new, independent directors to Bitfarms’ board through a special shareholders meeting scheduled after the company’s upcoming Annual General and Special Meeting on May 31.

    Bitfarms’ disappointing earnings compared to Riot Platforms

    Notably, Bitfarms’ disappointing earnings in 2023, despite a costly technical upgrade, have contributed to its vulnerability.

    Analysts had expected better performance post-Bitcoin halving, but Bitfarms’ April earnings dropped 29% year-on-year.

    In contrast, Riot reported a 131% increase in net income in Q1 2024, reaching $211 million.

    If successful, the combined entity would emerge as the largest publicly listed Bitcoin miner, boasting significant self-mining and power capacities.

    Riot Platforms envisions leveraging this enhanced scale and operational efficiency to drive future value creation for shareholders and strengthen its competitive position in the burgeoning cryptocurrency mining industry.

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  • Bitfarms mines less BTC in March despite expanding its mining Fleet

    Bitfarms mines less BTC in March despite expanding its mining Fleet

    • Bitfarms mined 286 BTC in March, down from 300 in February.
    • Bitfarms’ fleet upgrade aims for 21 EH/s and 21w/TH efficiency.
    • Bitfarms sold 284 BTC increasing treasury holdings to 806 BTC.

    Bitfarms Ltd. (BITF), a prominent global Bitcoin mining company, experienced a slight dip in its Bitcoin (BTC) production for the month of March 2024, despite its ongoing efforts to expand and upgrade its mining fleet.

    Bitfarms mined a total of 286 BTC in March 2024, down from the 300 BTC mined in February.

    This decline in production can be attributed to various factors, including participation in grid-stabilizing curtailment programs and power plant maintenance activities in Argentina.

    Additionally, a temporarily lower average operating EH/s and a 4.8% increase in network difficulty compared to the previous month also contributed to the decrease in BTC production.

    Bitfarms’ fleet upgrade and expansion plan

    Despite the decrease in BTC production, Bitfarms seems to be very committed to enhancing its mining capabilities.

    The company has been actively pursuing its fleet upgrade and expansion plan, aiming to reach 21 EH/s and 21w/TH in 2024.

    To achieve this goal, Bitfarms has made significant investments, including the purchase of 28,000 Bitmain T21 miners, along with additional S21 miners and S21 hydro miners.

    These acquisitions are part of Bitfarms’ strategy to improve operational efficiency and capitalize on the potential for increased mining margins amid rising Bitcoin prices.

    Current financial standing and future outlook of Bitfarms

    Bitfarms sold 284 out of the 286 BTC earned in March, generating total proceeds of $19.2 million.

    Furthermore, Bitfarms increased its BTC treasury holdings to 806, valued at $56.7 million, and held Synthetic HODL™ of 85 long-dated BTC call options, along with $66 million in cash, resulting in total liquidity of $123 million.

    Looking ahead, Bitfarms remains optimistic about its growth prospects.

    The company is set to participate in several upcoming conferences and events, including DigitalABC’s First Annual Canadian Crypto Asset and Blockchain Policy Conference and the Bitcoin Policy Summit.

    With its ongoing fleet expansion efforts and a focus on operational efficiency, Bitfarms is well-positioned to navigate the evolving cryptocurrency landscape and capitalize on opportunities in the market.

    By diligently expanding its mining fleet and adapting to market conditions, Bitfarms continues to solidify its position as a key player in the Bitcoin mining industry.

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  • Bitfarms reports a 7.3% increase in its monthly mining output

    Bitfarms reports a 7.3% increase in its monthly mining output

    bitfarms monthly mining output increase
    • Bitfarms produced 411 bitcoins last month and sold 362.
    • The Canadian miner is still lagging behind last year’s figures.
    • Bitfarms stock is currently down 40% versus its recent high.

    Bitfarms Ltd says its mining output popped 7.3% in September as it continued to install new miners and “fully energised” its facility in Rio Cuarto to 51 MW.

    Bitcoin still holds 703 BTC in total

    The Canadian miner produced a total of 411 bitcoins last month – of which it sold 362 for about $9.5 million. Geoff Morphy – the Chief Executive of Bitfarms said in a press release today:

    We continue to believe that many of our best opportunities for growth and investment will arise around the next Bitcoin halving expected to occur in April 2024.

    The Toronto-headquartered firm still holds nearly $20 million worth of Bitcoin (703 in total). Its total operating capacity now sits at 233 MW.

    Shares of the bitcoin mining company are still down about 40% versus their recent high.

    Bitfarms is still lagging last year’s figures

    Bitfarms is committed to strengthening its balance sheet and infrastructure ahead of the halving event next year – by which, it expects to have paid off under $10 million it still has in debt.

    The bitcoin mining company now has a total operating capacity of 233 MW. Its hash rate improved another 9.0% in September to 6.1 exahashes per second (EH/s).

    Bitfarms wanted its hash rate to hit 6.3 EH/s in the third quarter but “electrical infrastructure delays” at its Baie-Comeau facility saw it come a bit shy of the target.

    Note that the Canadian miner is still trailing the numbers it reported last year. Bitfarms mined 3,692 BTC in the first nine months of this year versus 3,733 Bitcoin in the equivalent period of 2022. Wall Street currently has a consensus “buy” rating on BITF.

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