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Hive Blockchain raises $30-million for new cryptocurrency mining centre

HIVE Blockchain

With its stock continuing to soar in the days since its trading debut, cryptocurrency miner Hive Blockchain (TSXV:HIVE) has decided to take advantage of its newly lofty price. In a press release Thursday, HIVE announced it would raise $30-million to acquire a second data centre.

Hive CEO Harry Pokrandt said GMP would lead a bought deal that will see the company sell $20-million shares at $1.50 for proceeds of $30-million.

Hive today also announced a deal with Genesis Mining, which owns 30 per cent of Hive, that will see the former acquire a cryptocurrency data centre in Reykjanes, Iceland. The company says the deal will improve its capacity by more than 70 per cent.

“This transaction significantly expands Hive’s mining capacity for minimal dilution to existing shareholders,” Pokrandt said. “We are pleased to strengthen our partnership with Genesis Mining and consolidate Iceland, a leading jurisdiction for cryptocurrency mining due to its low energy costs, cool climate and reliable Internet connectivity. We are also pleased to welcome the support of GMP and new investors.”

Bitcoin mining is a catch-all term that refers to the process of compiling recent transactions on the block chain ledger and releasing new bitcoin. In the early days of cryptocurrency the process was done by enthusiasts and hobbyists on home computers. But as its popularity grew, some larger players built data centres to conduct this process en massse. Like many other data centres around the world, they inevitably produce high levels of heat and need to be cooled, which is why most of them are located in colder climes such as Iceland and Canada.

At the Cantech Investment Conference several years ago, Canadian tech legend Sir Terry Matthews predicted this trend, though he couldn’t have known much about the ultimate application of the data centres.

Matthews said Canada, with its proximity to the United States, which accounts for about a third of worldwide data center energy usage, will become an obvious answer to the data centre problem. He noted that the Chinese had been building data centres in the northern city of Harbin, near the Siberian border, for years.

“Air conditioning for those data centres,” said the Mitel and Newbridge Networks founder. “Where would the average temperature be lowest? Would Alberta come to mind? Would Northern Ontario come to mind? Watch Canada become, for whatever reason, important to reduce power. Very important for the data centres.”

Shares of Hive have risen every day since its market debut Monday, and the stock has been the top volume trader on the junior exchange this week. At press time, shares of the company were up 13.6 per cent to $2.09.

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About The Author /

Cantech Letter founder and editor Nick Waddell has lived in five Canadian provinces and is proud of his country's often overlooked contributions to the world of science and technology. Waddell takes a regular shift on the Canadian media circuit, making appearances on CTV, CBC and BNN, and contributing to publications such as Canadian Business and Business Insider.

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