ZUG, Switzerland and VANCOUVER, June 28, 2019 /CNW/ - HIVE Blockchain
Technologies Ltd. (TSX.V:HIVE) (OTCQX:HVBTF) ("HIVE") and Genesis
Mining ("Genesis") are pleased to announce that they have reached a
settlement agreement which positively resolves prior
misunderstandings and disagreements. The agreement was reached with
a focus on initiatives which improve communication, transparency
and mutually beneficial cooperation between Genesis and HIVE.
Operationally, HIVE and Genesis will reboot HIVE's 20.4 Megawatt
("MW") facility in Sweden with
14,000 GPUs mining Ethereum. HIVE will continue to receive 300
Petahash ("PH") of cloud-based ASIC Bitcoin mining capacity from
Genesis.
Timing of the settlement agreement coincides with improved
economic conditions in the cryptocurrency ecosystem amid a
substantial decline in energy prices in Sweden and the significant appreciation of
digital assets including Ethereum and Bitcoin. Since HIVE's
April 22, 2019 announcement that its
equipment and operations in Sweden
had become dormant, Ethereum prices have nearly doubled, Bitcoin
has more than doubled and electricity prices in Sweden are approximately half of the cost
experienced in April. These conditions are expected to have a very
positive impact on HIVE's gross mining margin.
"I am pleased that we have been able to reach a settlement
agreement that focuses on peace and prosperity for both companies
and enables management to return to creating value for HIVE
shareholders," said Frank Holmes,
Interim Executive Chairman and Interim CEO of HIVE. "HIVE has a
tremendous portfolio of infrastructure assets and we are
benefitting from the dramatic resurgence of cryptocurrencies seen
in 2019. We look forward to transitioning our GPU mining assets in
Sweden and Iceland to our direct management or to a new
service provider and to our continued partnership with Genesis for
the delivery of our cloud-based ASIC mining capacity as Bitcoin and
Ethereum continue to increase in value in what has been a volatile
asset class. The blockchain ecosystem continues to evolve and it is
our belief that HIVE is well positioned to play a significant role
in this ever-changing technology. Further, this agreement better
positions HIVE for its next phase as HIVE 2.0 with improved
visibility and control over our global mining operations."
"As a significant shareholder in HIVE, Genesis is pleased to
have reached a resolution to this issue," said Marco Streng, CEO of Genesis. "We share HIVE's
vision of accelerating the development of the blockchain sector and
look forward to working collaboratively with HIVE to enhance value
for all shareholders."
The agreement settles outstanding issues associated with the
Sweden Data Center and both parties agreed to mutually release each
other from all claims arising from the master service and related
agreements, and discontinue any legal proceedings and withdraw any
demands made. Furthermore, HIVE will assume
responsibility for the operation of the Sweden and Iceland data centers from Genesis to itself or
a third party, and Genesis will provide transitional services to
HIVE to ensure an orderly transition. Additionally, the board of
directors will undergo a restructuring which will see Marco Streng and Björn Arzt resign as directors
of HIVE and its subsidiaries. As part of the agreement, for a
period of three years, Genesis will be entitled to nominate one
director to the HIVE board of directors provided it continues to
hold no less than 10% of the Company's shares.
Since inception, HIVE has pursued and innovated as a public
company in regulatory compliance and innovation. The transition to
HIVE 2.0 sees HIVE pursuing a strategic agreement with Argo Mining
on virgin coin off-take and its Mining-as-a-Service ("MaaS")
platform geared towards institutions, which sees continued demand
as a result of new FAFT regulation passed this week. HIVE has also
partnered with Amber AI, a crypto trader providing state-of-the-art
machine learning to optimize mining margins for HIVE's
operations.
About HIVE Blockchain Technologies Ltd.
HIVE Blockchain Technologies Ltd. is a growth oriented,
TSX.V-listed company building a bridge from the blockchain sector
to traditional capital markets. HIVE is strategically partnered
with Genesis Mining Ltd. to build the next generation of blockchain
infrastructure. HIVE owns state-of-the-art GPU-based digital
currency mining resources in Iceland and Sweden, which produce newly minted digital
currencies like Ethereum continuously as well as cloud-based
ASIC-based capacity which produces newly minted digital currencies
like Bitcoin. Its deployments provide shareholders with exposure to
the operating margins of digital currency mining as well as a
growing portfolio of crypto-coins.
For more information and to register to HIVE's mailing list,
please visit www.HIVEblockchain.com. Follow @HIVEblockchain on
Twitter and subscribe to HIVE's YouTube channel.
On Behalf of HIVE Blockchain Technologies Ltd.
"Frank Holmes"
Interim Executive Chairman
About Genesis Mining Ltd.
Genesis Mining is an industry leader of cryptocurrency mining
hosting services and mining related solutions. With over 2 million
users Genesis Mining is the world's leading multi-algorithm cloud
mining service. Genesis Mining operates various large scale, high
efficiency datacenters, and offers more than 15 minable
cryptocurrencies through 6 major mining algorithms.
https://www.genesis-mining.com.
Neither the TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in policies of the TSX Venture
Exchange) accepts responsibility for the adequacy or accuracy of
this news release.
Forward-Looking Information
Except for the statements of historical fact, this news
release contains "forward-looking information" within the meaning
of the applicable Canadian securities legislation that is based on
expectations, estimates and projections as at the date of this news
release. "Forward-looking information" in this news release
includes, but is not limited to, the Company's expectations to
orderly transition operations in Sweden and Iceland from, and to continue operations
(including rebooting operations in Sweden or otherwise profitably utilizing its
equipment) without, Genesis; the Company's engagement of a new
service provider; the Company's pursuit of potential strategic
partnerships with Argo Mining and Amber AI; the long term growth,
business goals and objectives of the Company, and other
forward-looking information concerning the intentions, plans and
future actions of the parties to the transactions described herein
and the terms thereon.
Factors that could cause actual results to differ materially
from those described in such forward-looking information include,
but are not limited to, the rebooting of the operations in
Sweden may not proceed as smoothly
or as profitably than anticipated; the transition of the operations
in Sweden and Iceland from Genesis to the Company may not
proceed as orderly or as timely as anticipated; counterparties to
agreements underlying the master services and related agreements
may not consent to the transfer and assignment of such underlying
agreements from Genesis to the Company, and the Company may not be
able to source alternative service providers on as favourable
terms; the integration of the new service provider(s) may not
proceed as smoothly as anticipated; changes in economic conditions
in the cryptocurrency ecosystem, fluctuations in energy prices in
Sweden, or depreciation of digital
assets including Ethereum and Bitcoin may adversely affect the
Company's continued operations and/or profitability; the
digital currency market generally; the Company's ability to
successfully mine digital currency; the Company may not be able to
profitably liquidate its current digital currency inventory, or at
all; a decline in digital currency prices may have a significant
negative impact on the Company's operations; the volatility of
digital currency prices; and other related risks as more fully set
out in the Filing Statement of the Company dated September 13, 2017 and other documents disclosed
under the Company's filings at www.sedar.com.
The forward-looking information in this news release reflects
the current expectations, assumptions and/or beliefs of the Company
based on information currently available to the Company. In
connection with the forward-looking information contained in this
news release, the Company has made assumptions about the Company's
ability to profitably liquidate its digital currency inventory as
required; historical prices of digital currencies and the ability
of the Company to mine digital currencies will be consistent with
historical prices; and there will be no regulation or law that will
prevent the Company from operating its business. The Company has
also assumed that no significant events occur outside of the
Company's normal course of business. Although the Company believes
that the assumptions inherent in the forward-looking information
are reasonable, forward-looking information is not a guarantee of
future performance and accordingly undue reliance should not be put
on such information due to the inherent uncertainty
therein.
SOURCE HIVE Blockchain Technologies Ltd.