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Monday, Mar 27, 2023
Mugglehead Magazine
Alternative investment news based in Vancouver, B.C.


Hut 8 Mining merges with U.S.-based data and Bitcoin mining group

The company will be called Hut 8 Corp and work as a Bitcoin miner

Hut 8 Mining merges with U.S.-based data and Bitcoin mining group
Hut 8 Mining in Medicine Hat. Image via Hut 8 Mining.

Hut 8 Mining (NASDAQ: HUT) (TSX: HUT) inked an all-stock merger deal with a Miami-based data mining analytics company to create crypto mining giant.

The merger is with Miami, Florida based data mining analytics company US Bitcoin Corp (USBTC). The company said Tuesday it will now be called Hut 8 Corp and will act as a large-scale publicly traded Bitcoin miner focused on economical mining, with diversified revenue streams, including high performance computing and colocation services. The new company will have access to 825 megawatts of gross energy across all six sites. It will also include self-hosting, hosting and managed infrastructure operations.

“Our established track record of creating shareholder value through organic growth and strategic acquisitions while maintaining a balance sheet-first approach has positioned us perfectly to advance our growth trajectory through this business combination,” said Hut 8 CEO, Jaime Leverton.

More specifically, the combined company will have 5.6 exahash per second (EH/s) of installed self-mining capacity and 244 megawatts of total energy available over five sites. These are Medicine Hat, Alberta; Drumheller, Alberta; Niagara Falls, New York; and Granbury and King Mountain, Texas.

The King Mountain site is a joint venture wherein USBTC owns 50 per cent.

At present USBT is embroiled in a legal dispute with the City of Niagara Falls, New York, over site operations. The team has a contingency plan in place should a resolution not be met. At present there’s no disruption to operations.

The King Mountain site leverages a mix of sources, including wind and nuclear, in support of multiple clients. This includes some of the industry’s biggest miners. The King Mountain JV owns the hosting function.

Read more: Filecoin Foundation and Lockheed Martin partner on an interplanetary file system

Read more: Akerna merges with Gryphon Digital Mining and implements Bitcoin mining

King Mountain joint venture uses renewable energy sources

“Bringing together Hut 8’s operational track record and diversified revenue streams with US Bitcoin’s scalable mining sites, sizeable hosting business, and industry-leading managed infrastructure operations not only accelerates our diversified strategy and positions us for near-term growth, but also establishes us as a strong, U.S.-based player that is ready and able to seize additional opportunities as they arise,” said Leverton.

Further, the combined company inherits 680 megawatts of infrastructure operations powered by energy from a mix of renewable and zero-emissions sources in Kearney, New Brunswick, and Granbury and King Mountain, Texas.

Some of the operational advantages of the merger include a stronger financial position and more flexibility for growth and investment.

“Together, we will become an exceptional self-mining operator, hosting provider, strategic operator of managed infrastructure, purveyor of high performance computing infrastructure, and industry-leading ASIC repair and sales hub, underpinned by world-class operating technology and IP to drive growth,” said Asher Genoot, co-founder and president of USBTC.

The merger pushes the company’s diversification strategy, allowing for monthly recurring fiat hosting revenues from long-term clients. This means reaching out to Bitcoin mining sites looking to maximize their mining capabilities through managed infrastructure operations.

The USBTC team also adds leadership in energy origination, development, demand response, hedging, grid stabilization and analytics.

These are important for the ability to plan around stable and predictable energy usage.


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