HIVE Digital Technologies (CVE: HIVE) (NASDAQ: HIVE) recently broke ground on a 100MW hydroelectric data center project in Paraguay, targeting operational readiness by Q3 2025.
Announced on Tuesday, this project aims to reach a hashrate of 12.5 EH/s with an efficiency of 17.6 J/TH, expanding HIVE’s capacity while emphasizing its commitment to sustainable practices through the use of green energy.
Hashrate is the measure of a computer’s processing power in solving complex mathematical problems to validate transactions on a blockchain network.
In line with its growth strategy, HIVE has also ordered 6,500 Canaan Avalon A1566 ASIC miners, reinforcing its ongoing investment in mining capabilities to maintain a competitive edge in the volatile crypto mining market.
Financially, HIVE reported approximately USD$22.6 million in revenue for the second quarter of 2024, largely from digital currency mining.
Additionally, HIVE’s High-Performance Computing (HPC) hosting segment now generates an annualized run rate of USD$9 million, reflecting growth and diversification beyond cryptocurrency.
“Our disciplined capital management allows us to seize opportunities for ASIC upgrades, boosting efficiency and adding accretive value while building our bitcoin hodl,” said Frank Holmes, executive chairman of Hive.
“With construction under way for our 100-megawatt green energy facility in Paraguay, we are using cash flow from operations to drive growth and capitalize on our position as both a bitcoin proxy and an operational business. Hive is committed to accretive investments that elevate shareholder value and cash flow.”
Analysts at Cantor Fitzgerald have initiated coverage with an “overweight” rating, suggesting that the market may be undervaluing HIVE’s potential hash rate growth and ambitions in GPU computing for artificial intelligence applications.
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Paraguay offers sustainable energy at a premium
Companies like HIVE are moving operations to countries like Paraguay due to favourable conditions for low-cost, sustainable energy. Paraguay’s abundant hydroelectric power, largely derived from the Itaipu Dam, provides a reliable and renewable energy source at lower rates than many other countries.
For cryptocurrency miners, where energy costs make up a substantial part of operational expenses, this affordable green energy presents an opportunity to reduce costs while also meeting environmental targets, which is increasingly important as both consumers and regulators push for more sustainable practices in the tech sector.
Other companies are also following similar paths, looking for regions with abundant, cost-effective renewable energy to support their operations.
For example, Bitfarms Ltd (TSE: BITF) (NASDAQ: BITF) has established mining operations in Argentina, benefiting from a favourable energy rate structure and a stable, affordable electricity supply.
Additionally, Argo Blockchain PLC (NASDAQ: ARBK) has expanded into Texas, USA, where it accesses wind and solar power at competitive rates, allowing the company to scale its operations while aligning with its commitment to renewable energy.
These moves reflect a broader trend among cryptocurrency miners who are relocating to regions where renewable energy sources can both lower costs and reduce carbon footprints.
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