Major Bitcoin miners Hut 8 Mining and US Bitcoin Corp announced today a merger that will bring the two companies together to create a North American crypto mining giant.
Tuesday’s announcement so The move will create Toronto Stock Exchange- and Nasdaq-listed Hut 8 Corp following the all-share deal.
The new entity will have a market value of 990 million dollars, and the shareholders will have equal ownership of the company’s shares.
CEO of Toronto-based Hut 8 Jaime Leverton said in a press release that the move would allow the company to “leverage the significant, unencumbered Bitcoin stack we’ve held until now.”
The new company will have access to approximately 825 megawatts of “gross energy” at six locations in the United States and will use a mix of energy sources, including wind power and nuclear power.
The move comes as Bitcoin miners increasingly struggle with falling digital asset prices. In December, major miner Core Scientific filed for bankruptcy.
And the major miner Greenidge Generation has so their viability is in “substantial doubt”.
Other mining companies sell their mined Bitcoin to pay off debt.
This is because a drop in the price of the largest cryptocurrency by market capitalization has made it harder for firms to make money – especially with mining difficulties increase.
As Bitcoin becomes harder to mine, more energy is needed – which means more expensive machines. And when the price of Bitcoin is down, the rewards for miners are lower, which means less money to spend on mining technology.
But despite the industry being tough, it is still profitable and miners can reap rewards if they are not handed over and have a low-energy model, according to experts.
Scott Norris, co-founder of Bitcoin miner LSJ Ops, previously told Decrypt that experienced miners “have seen many of these bear markets before and have a model that carried them through it plus a low energy cost.”
Bitcoin is currently priced at $23,012 per coin, according to CoinGecko. Just a year ago it was valued at $43,910.
Its all-time high was $69,044 in November 2021, but it has not come close to touching that level again since then.
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