Key Points
- Bitfarms has entered a second hosting agreement with Stronghold Digital Mining, deploying 10,000 miners at Stronghold’s Scrubgrass facility.
- Despite increasing Bitcoin production, Bitfarms’ stock has fallen due to broader market pressures.
Bitfarms, a key player in the Bitcoin (BTC) mining industry, has strengthened its partnership with Stronghold Digital Mining. This partnership was solidified via a second hosting agreement through a Bitfarms subsidiary.
The agreement will result in the deployment of 10,000 miners at Stronghold’s Scrubgrass facility in Pennsylvania. Initially, these miners were planned to be positioned in Yguazu, Paraguay. These miners are scheduled to start operations in December 2024, which is likely to enhance Bitfarms’ mining capabilities.
CEO’s Statement
Ben Gagnon, CEO of Bitfarms, commented on this agreement. He stated that these upgrades at Stronghold’s Pennsylvania sites would provide significant value for Bitfarms. Gagnon also mentioned that the deployment of 20,000 efficient miners, in collaboration with Stronghold’s energy facilities, would improve overall fleet efficiency and reduce operational costs.
This arrangement would not only facilitate energy trading but also allow operational flexibility. It would enable Bitfarms to adjust mining activities based on energy market conditions to optimize profitability.
Agreement Details
The Hosting Agreement between Bitfarms and Stronghold will last until 31 December 2025. It includes annual automatic renewals unless canceled by either party. Notably, Bitfarms will share 50% of its mining profits with Stronghold.
The company has already deposited $7.8 million to cover estimated power costs for the first three months. This amount will be fully refunded by the end of the initial term. This setup ensures operational continuity, while offering Bitfarms some flexibility and cost predictability in its mining efforts.
In June, Bitfarms increased its Bitcoin production to 189 BTC, up from 156 BTC in May. It also sold 134 BTC for $8.8 million, raising its total holdings to 905 BTC. However, its 2024 output has dropped by over 50%, with only 1,557 BTC mined so far compared to 2,520 BTC at the same time last year.
The latest data from IntoTheBlock revealed that Bitcoin mining rewards rose from 378.13 BTC ($23.37 million) in June to 493.75 BTC ($35.12 million) in October. Amidst this, Bitfarms’ stock fell by 10% in after-hours trading to $1.96 and dipped to $1.93. This coincided with a 2.61% drop in Bitcoin’s value, with the crypto trading at $70,140.91 at press time.