HIVE Blockchain Announces Major Expansion in Sweden, Including New Bitcoin Mining Facility, and up to $100 Million Financing
ZUG, SWITZERLAND and VANCOUVER, BRITISH COLUMBIA--(Marketwired - Dec. 13, 2017) -
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HIVE Blockchain Technologies Ltd. (TSX VENTURE:HIVE) (the "Company" or "HIVE"), the leading publicly listed blockchain infrastructure company, is pleased to announce that it has entered into binding letter agreements dated December 13, 2017 with its strategic partner and major shareholder, Genesis Mining Ltd. ("Genesis"), the largest digital currency mining hashpower provider, to significantly expand the Company's digital currency mining operations in Sweden in 2018, including the addition of a large-scale Bitcoin mining facility.
This major expansion will increase HIVE's energy consumption dedicated to digital currency mining from a targeted 17.4 megawatts ("MW") in March 2018 to 24.2 MW in April 2018, escalating to an expected 44.2 MW by September 2018, and will include:
- a new ASIC-based data centre in Sweden, with hardware procured and assembled by Genesis on behalf of HIVE for consideration of an estimated US$34 million and expected to come online in September 2018. The hardware will consist of the latest generation of Bitcoin mining rigs and will operate at an estimated rate of 200 petahashes per second ("PH/s") and support an approximate consumption of 20 MW of electricity; and
- a third phase (additional 6.8 MW) of the Company's previously-announced GPU-based data centre in Sweden, customized for mining GPU-based digital currencies (e.g., Ethereum), for consideration of an estimated US$22 million and expected completion in April 2018.
The Company is also pleased to announce a private placement financing of up to C$100 million, led by GMP Securities L.P. and Eventus Capital Corp., with a lead indication of C$50 million received.
"The addition of Bitcoin mining capability further establishes HIVE as a leader in digital currency mining and diversifies our revenue with a highly liquid currency," commented Harry Pokrandt, President, CEO and a Director at HIVE. "Our new Bitcoin facility will be among the most energy-efficient and largest Bitcoin mining farms in Europe. This facility will complement our large-scale GPU-based facilities being built in Sweden and currently operating in Iceland, and allow us to diversify from mining GPU-driven consensus algorithms to also include SHA-256 consensus algorithms. Sweden, like Iceland, is an excellent jurisdiction for HIVE with its abundant cheap electricity, good governance, and cool climate."
To view Figure 1 please click on the following link: http://media3.marketwire.com/docs/HIVE1213.pdf
Sweden Bitcoin Data Centre
HIVE has rapidly established a portfolio of GPU-based digital currency mining operations in Iceland and Sweden, with assistance from Genesis. The Company's mining focus to date has been on the Alt-coin market, including Ethereum, Ethereum Classic, and ZCash. In addition to these and other digital currencies, Genesis is one of the leading miners of Bitcoin. HIVE is pleased to enter the Bitcoin mining market through the acquisition of new custom-designed ASIC-based digital currency mining rigs from Genesis on attractive terms, to be deployed at a state-of-the-art facility being constructed by Genesis in Sweden (such portion of the data centre housing HIVE's rigs, the "Sweden Bitcoin Data Centre").
The Sweden Bitcoin Data Centre will consist of newly constructed SHA-256 based ASICs for digital currencies such as Bitcoin and Bitcoin Cash mining (the "Equipment") at an estimated rate of 200 PH/s and supporting an approximate consumption of 20 MW of electricity. The Equipment will be designed for efficiency and scale utilizing Genesis' expertise, and will be acquired for consideration of an estimated US$34 million. Pursuant to a master services agreement between the Company and Genesis, Genesis will be responsible for hosting, maintenance and related services for the Sweden Bitcoin Data Centre for a monthly fee.
Genesis expects to break ground on the new facility in May 2018 and the Sweden Bitcoin Data Centre is expected to come online by September 2018.
Completion of the Sweden Bitcoin Data Centre is subject to a number of conditions, including but not limited to, approval of the TSX Venture Exchange (the "Exchange") as required, and completion of the Offering as defined below).
Sweden Expansion Phase 3
In addition to the Sweden Bitcoin Data Centre, HIVE is pleased to announce that it will finance the construction of a third phase of GPU-based digital currency mining rigs (the "Phase 3 Expansion") at its previously-announced GPU-based data centre in Sweden (the "Sweden GPU Data Centre"). Please refer to the Company's October 23 and 25, 2017 news releases for more detail on the first and second phases of construction at the Sweden GPU Data Centre.