Following its information launch on July 22, 2024, HIVE Digital Applied sciences Ltd. (HIVE) introduced that it has signed a definitive settlement (“Settlement) for the event of a 100 megawatt (“MW”) digital asset mining operation in Paraguay. The settlement consists of (i) a share buy settlement (“spaParaguay Digital Co., Ltd. (“HIVE Paraguay(hereinafter “the Firm”), the proprietor of W3X SA (hereinafter “W3X SA”).translation” or “the purpose“); and (ii) building contracts (“Building Contract“) has acquired W3X SA (“translation” ), and skilled native contractors (or “Contractor) (All quantities are in US {Dollars} until in any other case said.).

Aydin Kilic, President and CEO of HIVE, stated, “We’re proud to have secured a 100 MW PPA in Paraguay that leverages inexperienced, clear power offered by the Itaipu Hydroelectric Dam. Our crew is difficult at work designing and constructing a further 6.5 exahash per second (EH/s) Bitcoin mining infrastructure, which is able to improve our international EH/s to 12.1 EH/s.” Nonetheless, we’re restricted to 100 MW of funding after turning down a further 150 MW because of sudden fiscal coverage modifications. Like many different public miners, we are going to discover different international locations that provide key electrical infrastructure, information facilities for the worldwide digital financial system, US foreign money revenues, and secure capital with clear fiscal agreements.

HIVE Chairman Frank Holmes stated: “Steady fiscal coverage is crucial to attracting and retaining continued international direct funding from public corporations and US institutional traders. We’ll proceed to advocate for honest remedy of the information heart and bitcoin mining industries, as we’ve accomplished in Canada, the US and Sweden. Paraguay's information facilities act as a foreign money hedge by producing thousands and thousands of US {dollars} in secure month-to-month revenues for the government-owned utility. Public corporations and institutional traders have a multifaceted long-term imaginative and prescient for his or her shareholders, contributing to the expansion and growth of the area, offering significant job alternatives, governance and transparency, and selling schooling and the event of knowledge heart expertise wanted for the worldwide digital financial system.”

Strategic Funding Plan for Paraguay

HIVE has revealed its strategic funding plans for Paraguay in response to a current proposal to impose a discriminatory 14% power fee hike on Bitcoin information facilities.

Holmes added, “Whereas we’re excited in regards to the alternative in Paraguay, proposed will increase in power tariffs create uncertainty that can affect our long-term funding resolution. We’ve got conveyed our issues to the federal government and look ahead to continued discussions to deal with these challenges. Steady prices and dependable contract phrases are important to attracting international public funds. We look ahead to the federal government addressing these insurance policies and guaranteeing continued funding.”

After constructive conferences with key Paraguayan stakeholders in Could, HIVE initially deliberate for a bigger international direct funding (FDI), together with land acquisition and negotiating PPAs for 2 potential tasks of 100 MW every and one other of fifty MW. This funding is anticipated to exceed $250 million and displays HIVE's confidence in Paraguay's imaginative and prescient and management. Nonetheless, a proposed 14% power tariff improve, quick contract phrases and uncertainty about power costs have mixed to scale back our funding and delay our HPC information heart technique with the Nvidia GPU chip suite wanted to affix the AI ​​increase.

The 100MW undertaking would require important international direct funding to Paraguay, offering the required capital to transform excessive voltage electrical energy into usable electrical energy for manufacturing and houses. Electrical energy payments from HIVE will herald regular US greenback earnings of over $100 million over three years, serving to to construct the electrical energy infrastructure in addition to offering a gradual month-to-month revenue. This offers an artificial US greenback hedge that banks can’t match. Moreover, the price of {the electrical} infrastructure wanted to step down the excessive voltage electrical energy for industrial and residential use is estimated at round $16 million, creating native jobs. Native contractors stated right now that they plan to mobilize round 80 building staff instantly for the preliminary works.

The Paraguayan guaraní has ​​depreciated roughly 36% towards the US greenback over the previous 5 years and roughly 16% over the previous yr, underscoring the significance of regular international funding and US greenback revenues to Paraguay's financial stability and progress.

As a world asset supervisor, Holmes emphasised: “Analysis helps the truth that increasing electrical energy infrastructure boosts financial progress. World Financial institution and IEA research spotlight that funding in electrical energy infrastructure is crucial for financial growth, bettering productiveness, industrial progress and bettering high quality of life.”

HIVE shouldn’t be alone in its cautious stance. Different publicly-listed bitcoin mining corporations gathered on the largest bitcoin convention in Nashville final week, the place they stated they had been equally reconsidering their plans to spend money on Paraguay because of the proposed tariff will increase and contractual restrictions. This collective response at a Nashville convention the place each former President Trump and Robert F. Kennedy Jr. endorsed the significance of bitcoin and bitcoin mining throughout their political campaigns on this yr's U.S. presidential elections solely demonstrates the necessity for secure authorities fiscal insurance policies to draw and retain important international capital funding from publicly-listed mining corporations and institutional traders.

HIVE's method relies on a clear “Return on Invested Capital (ROIC)” mannequin and helps sustainable investments and group engagement, as demonstrated by our profitable operations in Sweden and Canada. We worth the chance to contribute to Paraguay's financial progress and stay dedicated to fostering a business- and investment-friendly surroundings.