Bitfarms Bitcoin Mining Report

Bitcoin miner Bitfarms reported generating 233 BTC (approximately $13.9 million) in August, with its operational hashrate increasing 2% month-over-month to 11.3 EH/s.

Despite the hashrate growth, this month’s BTC production shows an 8% decrease compared to July’s 253 BTC. The drop was attributed to elevated average network difficulty levels. Year-over-year, August production is down 39%, influenced by the halving event’s impact on miners’ revenues back in April, alongside a near all-time high network hashrate.

Bitfarms sold 147 BTC (around $8.8 million) as part of its treasury management strategy, while the remaining 86 BTC (approximately $5.1 million) were added to its treasury. This brings Bitfarms’ total holdings to 1,103 BTC (valued at $65.1 million).

Additionally, Bitfarms announced plans to acquire Stronghold Digital in an estimated $175 million deal financed through stock and debt. CEO Ben Gagnon highlighted that the acquisition would help the company improve its energy portfolio and aim for an expansion to 950 MW by the end of 2025, with nearly half of its capacity grounded in the U.S.

Rival Mining Dynamics

Riot Platforms previously attempted to acquire Bitfarms in April for about $950 million but faced challenges engaging with the company’s board. Following withdrawal of their bid at $2.30 per share, Riot began purchasing stock to become the largest shareholder with about 19.9% stake.

In a recent open letter to Bitfarms shareholders, Riot Executive Chairman Benjamin Yi and CEO Jason Les expressed concerns over Bitfarms’ governance changes and the Stronghold acquisition just ahead of an impending vote to reconstitute Bitfarms’ board on October 29. They called for more independent oversight and improvements in governance practices to boost shareholder value.

Following the resignations of two co-founders from the board, Bitfarms appointed Fanny Philip and Ben Gagnon as part of leadership adjustments. However, Riot described these changes as inadequate, insisting on the importance of independent directors to shape the future strategy of Bitfarms while critiquing its recent “poison pill” strategy, which aims to limit ownership stakes.

Riot’s attempts to cease the poison pill plan were successful, yet Bitfarms adopted another shareholder rights plan allowing a 20% accumulation of shares for the next six months.

The acquisition timing drew further scrutiny, being near the board reconstitution meeting, and the premium offered to Stronghold’s share price raised eyebrows over its alignment with shareholders’ interests.

Riot also pointed out the lack of engagement from Bitfarms regarding the appointment of Philip, despite their status as the largest shareholder. With proposed changes already in place, Riot intends to reduce its push for new independent board members from three to two, nominating Amy Freedman and John Delaney to replace two current directors in the upcoming meeting. They emphasized the need for both shareholder voice and responsible governance strategies moving forward.

Bitfarms did not comment promptly on the concerns raised by Riot.