Bitfarms Ltd (NASDAQ: BITF) (TSX: BITF) climbed to an operating hashrate of 12.8 EH/s in November after deploying miners to Stronghold Digital Mining’s sites in Pennsylvania, originally set out in a hosting agreement in September and October 2024.
The company announced in a Monday press release that it anticipates that 75 per cent of its hashrate will come from North American data centers by the first half of 2025.
Hashrate refers to the total computational power used by cryptocurrency miners to process transactions and secure a blockchain network. It is measured in hashes per second (H/s) and represents how quickly a miner or group of miners can solve complex mathematical problems required to add new blocks to the blockchain.
The higher the hashrate, the more secure and efficient the network becomes, as it becomes more resistant to attacks like the 51 per cent attack, where bad actors gain control of most of the network’s mining power to manipulate transactions.
Hashrate is a key metric in the cryptocurrency industry because it directly correlates with profitability for miners and the overall health of the network.
High hashrates often attract miners and investors to a cryptocurrency, as they indicate strong network security and trustworthiness.
However, this also fuels fierce competition among miners and mining companies, pushing them to develop or acquire more efficient hardware and access to cheap energy sources.
This competition has led to the emergence of large-scale mining operations and innovation in mining technology, while also sparking debates over energy consumption and environmental impact in regions with dense mining activities.
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Bitfarms generated USD$45M in Q3
The company mined 204 BTC during the month and increased its Bitcoin treasury to 1,221 BTC by selling 171 BTC as part of its treasury management strategy. It also reduced its synthetic HODL, holding 584 long-dated BTC call options at the end of November compared to 802 the previous month. Bitfarms continued upgrading its fleet, incorporating nearly 19,000 Bitmain T21 miners to enhance efficiency and boost its hashrate.
Bitfarms also generated USD$45 million in revenue for the third quarter of 2024, increasing revenue by 8 per cent from the second quarter and 30 per cent from the same quarter last year. However, its gross mining margin declined to 38 per cent from 51 per cent in Q2 2024 and 44 per cent in Q3 2023, reflecting higher operational costs and intensified network competition in Bitcoin mining.
The company reported a net loss of USD$37 million for Q3, widening from USD$27 million in Q2, primarily due to accelerated depreciation on older mining rigs. Bitfarms also reported adjusted EBITDA of USD$6 million for the quarter, down from USD$8.9 million in Q2, highlighting financial strain from rising expenses.
Bitfarms announced significant strategic initiatives, upgrading its miners from Bitmain T21s to S21 Pros and expanding its power portfolio to exceed 950 MW by 2025. The company appointed Andrew Chang as a new Independent Director, reinforcing its focus on strategic growth. It is prioritizing U.S. expansion, targeting 75 per cent of its hash rate to be based in North America by 2025, leveraging hosting agreements with Stronghold Digital Mining to achieve this goal.
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