The Supreme Court of British Columbia has given consent to the proposed merger between Hut 8 Mining Corp. (TSX: HUT) (NASDAQ: HUT) and Miami-based data mining analytics company US Bitcoin Corp (USBTC), taking the process one step closer to completion.
The transaction’s completion depends on several conditions, including the registration statement of USBTC becoming active, approval from USBTC’s shareholders, and other typical closing requirements for such deals, according to a statement made on Tuesday.
If all these conditions are met or exceptions are granted the company anticipates the transaction will be finalized in Q4 of 2023. After the transaction is completed, the company plans to change its name to Hut 8 Corp and its shares will continue to be traded on the Nasdaq and Toronto Stock Exchange under the symbol HUT.
Last week, the shareholders of the Canadian bitcoin mining company gave strong support for the merger deal.
“We’re confident that, upon completion, Hut will emerge as a stronger enterprise, underpinned by both bitcoin and diversified fiat revenue streams from our high performance computing, hosting and managed infrastructure operations businesses, the latter of which involves the team overseeing the maintenance and management of third party mining sites using our purpose-built software,” said Jaime Leverton, chief executive officer of Hut 8.
Hut 8 moved over 6,000 mining rigs to Texas
The new company will have a total installed self-mining capacity of 5.6 exahash per second (EH/s) and access to 244 megawatts of energy across five locations. These locations include Medicine Hat and Drumheller in Alberta, Niagara Falls in New York, and a 50 per cent stake in a joint venture at King Mountain in Texas.
Hut 8 recently relocated around 6,400 ASIC mining rigs from its inactive facility in North Bay, Ontario, to Texas. This move aims to meet the growing demand for artificial intelligence (AI) and high-performance computing.
The decision to move the hardware from the North Bay facility was mainly prompted by an ongoing legal dispute between Hut 8 and Validus Power, a third-party energy supplier. The dispute revolves around alleged failures to meet contractual obligations. Consequently, operations at the mining facility have been halted since November 2022.
In August 2023, Foundry Digital, the institutional mining and staking subsidiary of Digital Currency Group, announced a formal partnership with Hut 8. Under this agreement, Hut 8 will provide support for various business offerings by Foundry, utilizing its data center located in Ontario. Foundry has been utilizing Hut 8’s infrastructure to support its cryptocurrency mining pool since 2020.
Hut 8 shares dipped 3.4 per cent to $2.81 on Monday on the Toronto Stock Exchange.
Against all odds bitcoin has become big business
In recent years, Bitcoin mining has surged in popularity and evolved into a significant business sector.
Increasing recognition of Bitcoin as a legitimate asset class has attracted institutional investors, who view it as a store of value and a hedge against economic uncertainties. Additionally, growing mainstream acceptance and adoption of cryptocurrencies have led to a broader user base, with more people seeing Bitcoin as a viable form of digital payment.
Also, the development of cryptocurrency infrastructure, including exchanges, wallets and payment platforms, has made it easier for businesses and individuals to buy, hold and transact in Bitcoin.
Bitcoin’s limited supply and the concept of digital scarcity have also contributed to its appeal, as investors seek assets with deflationary characteristics. Finally, the decentralized and borderless nature of Bitcoin appeals to those who value financial autonomy and accessibility, further driving its growth as a significant and lucrative industry in recent years.
A few companies operating in the Bitcoin mining sector include Marathon Digital Holdings (NASDAQ: MARA), Riot Platforms (NASDAQ: RIOT) and Bitmain Technologies Ltd., the world’s largest private provider of Bitcoin mining ASIC rigs.