Falling crypto prices have forced many crypto miners to cut costs or consolidate in order to survive the crypto winter.
According to Jamie Leverton, CEO of Hut 8, the collapse of the crypto exchange FTX and the turmoil in the crypto market were not the main reasons for the decision to merge the crypto mining company Hut 8 with the US Bitcoin Corp.
On Feb. On January 8, Leverton said the merger was intended to bring in diversified revenue and help grow the combined business, saying:
“I think that this agreement would have been done anyway. We think that our ability to bring these companies together is incredibly supportive. »
The merger of all products was announced on February 2. 7, with a joint venture – called Hut 8 Corp. or “New Home” – based in the United States rather than Canada. Regarding FTX’s fall in November, Leverton said the fear is “starting to subside a little bit” and interest is returning to the crypto industry.
He added, “I think we’re seeing a lot of interest coming back into this space, and we’ve seen a lot of appreciation across the board so far in 2023.”
The merger of the two mining companies “will provide an incredible number,” he continued, adding that there will be “different programming,” which is a good plan for both companies themselves. The new building will be able to receive about 825 megawatts in six plants in New York, Texas, and the province of Alberta in Canada. The total combined mining power will be 5.6 exahashes per second (EH/s). Commenting on the choice of location, Leverton said it was in the company’s interest to have a “diverse landscape”, adding:
“One of the advantages here is [that the merger] gives us the diversity of this area. There is uncertainty in the legal environment on both sides of the border,”
Hut 8 has a mine in North Bay, Ontario, but operations have been suspended due to ongoing legal battles with its energy suppliers. The US Bitcoin Center in Niagara has its own problems with the ongoing dispute with the city of Niagara Falls over residents’ complaints about noise levels.
The company provided more details about the merger at a presentation on February 2. 8. The transaction is expected to close in the second quarter of 2023, subject to shareholder, regulatory, and stock exchange approval. Last week, Leverton said that in the short term, the company plans to cover its costs through the combined sale of Bitcoin it mines and explore different payment options.
Hut 8 shares fell 8% on the day the merger was announced. Additionally, according to MarketWatch, Hut’s shares fell 1.2% on the day to $2.12 in after-hours trading. The stock is currently trading 86% from its November 2021 high of $15.28.
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