Mining company Bitfarms recently announced it entered into a hosting agreement with Stronghold Digital Mining to bring an additional 2.2 exhashes per second (EH/s) of computing power online during October 2024—two months ahead of schedule.
The agreement will add 10,000 Bitmain T21 miners to Bitfarms’ Panther Creek facility in Pennsylvania and commence on October 1, 2024.
Ben Gagnon, CEO of Bitfarms, touched on the expansive potential of the company’s sites in Pennsylvania and said the sites would be key to diversifying the company’s business operations. Gagnon explained that the sites:
“Provide access to energy trading opportunities, competitive power costs, and HPC/AI. We look forward to completing our acquisition of Stronghold and accelerating our strategy to diversify beyond Bitcoin mining to create greater long-term shareholder value.”
Bitfarms will pay Stronghold a fee equivalent to 50% of the profits generated from the miner hosting agreement, which will renew annually until either party decides not to renew the contract.
Related: Bitfarms assumes control of 120 MW mining mega-site in US
Stronghold acquisition comes under fire from Riot Platforms
Bitfarms recently rescheduled its special shareholders meeting—originally slated for Oct. 29, 2024, to Nov. 6, 2024—to give the Bitfarms Special Committee “adequate time to review and respond” to demands made by Riot Platforms.
Riot Platforms—which is the largest shareholder of Bitfarms—issued an open letter to shareholders on Sept. 3, calling for changes to Bitfarms’ board of directors. Riot characterized Bitfarms’ corporate governance as “broken” and proposed electing two independent candidates to the board.
In the letter, Riot Platforms specifically cautioned Bitfarms’ investors about Bitfarms’ acquisition of Stronghold—claiming that the deal was “designed to entrench” the Bitfarms board. Riot also characterized the acquisition as “dilutive” to shareholder value—claiming that competitors were unwilling to buy Stronghold at the price Bitfarms paid to acquire the company.
Bitfarms responds to Riot’s claims
Bitfarms responded to Riot’s proposals by claiming that Riot proposed the board changes to further its own interests.
The embattled mining company also defended its acquisition of Stronghold Digitial Mining as a way to rebalance its energy portfolio toward United States-based operations.
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