Bitfarms Announces New Lease Financing for an Additional 1,000 New Generation Miners Adding 72 Petahash of Computing Power by the End of November and setting a Corporate Goal to Exceed 3.0 Exahash by the end of 2021
TORONTO & BROSSARD, Québec–(BUSINESS WIRE)–Bitfarms Ltd. (“Bitfarms”, or the “Company”) (TSXV:BITF) is pleased to announce that it has entered into an equipment lease with BlockFills for 1,000 WhatsMiner M31S miners to be delivered and installed by the end of November 2020. The 1,000 new Miners are in addition to the non-binding Letter of Intent (“LOI”) with Blockfills, announced on September 21, 2020, to lease approximately 7,000 new generation miners with a cost of US$12 to $15 million. As previously reported, the equipment covered by the LOI represents approximately 800 to 840 petahash per second (“PH”) of new computing capacity to be added to the Company’s operations by the end of 2020.
New Equipment Lease
On October 8, 2020, the Company entered an equipment lease with BlockFills, for an additional 1,000 WhatsMiner M31S miners for a term of 24 months carrying an implicit annual interest rate of 9.5%. The lease also includes a bargain purchase option which, when exercised, will transfer ownership of the equipment to Bitfarms at end of the lease term for a nominal amount. Bitfarms will make weekly lease payments that will fully retire the capitalized cost of the miners over the term of the lease. The new mining hardware is expected to be fully operational by the end of November and will add approximately 72 PH to the Company’s installed computing power as well as consuming approximately 3.5 megawatts (“MW”) of electricity.
Summary of Aggregate Computing Power Expansion in 2020
June 2020: Purchased 1,847 WhatsMiner M20S adding 133 PH of computing power
August 2020: Leased 1,000 WhatsMiner M31S+ adding 82 PH of computing power
October 2020: Leased 2,000 WhatsMiner M31S adding 144 PH of computing power
November 2020: Leased 1,000 WhatsMiner M31S adding 72 PH of computing power
This represents 431 PH of total growth on a year-to-date basis which represents a 55% increase over the Company’s starting capacity of 780 PH as of January 1, 2020. The new miners improve Bitfarms’ computing power-to-electricity efficiency ratio from 14.4 PH/MW to 18.5 PH/MW and bring our average cost per Bitcoin to approximately US$7,200 (based on market conditions on the 12th of October 2020 with a Bitcoin price of US$11,400).
Additional Computing Power Expansion Expected in 2020 per LOI with BlockFills
November 2020: Lease of 4,000 WhatsMiner M31S+ adding 328 PH of computing power
December 2020: Lease of approx. 2,000 WhatsMiner M30S adding 176 PH of computing power
After completion of all leases with BlockFills as per the terms of the LOI, Bitfarms’ estimated expansion in 2020 will total 935 PH. After retirement and sale of previous generation mining equipment, Bitfarms’ entire mining equipment fleet will consist of over 17,000 new generation miners representing 1.31 EH of computational power and an overall efficiency of 21.86 PH/MW, placing it amongst the top of all publicly traded mining operations.
With the successful installation of this new computational capacity, Bitfarms expects that it will bring its average cost per Bitcoin down to approximately US$6,000 by the end of the year (based on market conditions on the 12th of October 2020 with a Bitcoin price of US$11,400).
Emiliano Grodzki, Interim Chief Executive Officer of Bitfarms added, “Bitfarms continues to solidify its position as the industry leader in terms of operational hash rate, efficiency, and financial performance. The new equipment will fully utilize the installed infrastructure at our five high-powered data centers and will immediately be accretive to our financial performance. Unlike many of our competitors, Bitfarms operates all its computing power through its own facilities with wholesale energy prices avoiding costly hosting arrangements that may be terminated by the host with short customary notice periods. This positions Bitfarms uniquely as a sustainable and long-term mining operation.”
About Bitfarms Ltd.
The Company owns and operates computing centres that power the global decentralized financial economy. Bitfarms provides computing power to cryptocurrency networks such as Bitcoin, earning fees from each network for securing and processing transactions. Powered by clean and competitively priced hydroelectricity, Bitfarms operates five computing centres in Québec, Canada. Bitfarms’ experienced management team includes industrial-scale data centre operators and capital markets professionals, focused on building infrastructure by developing and hosting one of the industry’s most efficient ecosystem growing around blockchain-based technologies.
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This news release contains certain “forward-looking information” within the meaning of applicable Canadian securities laws that are based on expectations, estimates and projections as at the date of this news release. The information in this release about future plans and objectives of the Company, are forward-looking information. Other forward-looking information includes but is not limited to information concerning: the intentions, plans and future actions of the Company, as well as Bitfarms’ ability to successfully mine digital currency, revenue increasing as currently anticipated, the ability to profitably liquidate current and future digital currency inventory, volatility of network difficulty and digital currency prices and the resulting significant negative impact on the Company’s operations, the construction and operation of expanded blockchain infrastructure as currently planned, and the regulatory environment of cryptocurrency in the Provinces of Canada.
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