Posted on February 4, 2023 at 11:06 PM
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Hut 8 Mining Corp, a cryptocurrency mining company based in Canada, has announced a merger with US Bitcoin Corp. The two companies boards have also agreed to name the new company “Hut 8 Corp” or “New Hut.”
Hut 8 announces merger with US Bitcoin
The details of this merger agreement said that New Hut would become a large-scale Bitcoin mining firm with publicly traded shares. The merged firm would also be focused on economic mining and diversifying the company’s revenue streams. There would also be an increased focus on adopting the best ESG practices.
The CEO of Hut 8, Jaime Leverton, commented on this development, saying that the company had a proven track record of creating value for the shareholders through organic growth and strategic acquisition deals. The executive added that it had pursued this merger agreement as part of the company’s financial approach.
“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 US-based player that is ready and able to seize additional opportunities as they arise,” Leverton said.
After this merger deal, the new company will have access to 825 megawatts of power across its six mining facilities. The power will be available to support cryptocurrency mining and other operations. The sites that will access the power supply include five mining locations in Alberta Province, New York, and Texas. These facilities have a self-mining capacity of 5.6 exahashes per second.
Leverton said this merger deal would allow the company to use its hodled BTC. During the interim phase of this merger, the company plans to cover the operating costs using mined Bitcoin, selling its Bitcoin stack, and exploring debt options.
The merger between the two crypto mining companies is subject to regulatory approval by US and Canadian authorities. Hut 8 also said that there are legal concerns surrounding US Bitcoin. The miner said that there was “a legal dispute” in the City of Niagara Falls where the city’s residents have criticized the company’s operations, accusing the miner of causing noise pollution.
Crypto mining companies making changes
Crypto mining companies have suffered immensely following the bear market witnessed in 2022. The price of Bitcoin dropped at a time when energy costs skyrocketed, which affected miner margins. Mining companies such as Compute North were forced to file for bankruptcy.
Argo Blockchain is another leading mining company that has also undergone financial troubles. The mining firm was forced to sell its Helios mining facility to Galaxy Digital to settle its debts and sustain its operations. The miner recently released its financial results for January. The results showed it had mined 168 BTC, with the monthly mining revenue reaching $3.4 million. The company said that by the end of January, it held 115 BTC and BTC equivalents.