Bitcoin miner CleanSpark climbed on Tuesday after the company said it will acquire new mining facilities that will give it the power and infrastructure to potentially double its hashrate within the first half of the year.
CleanSpark shares were last higher by nearly 9%. At one point, the stock rose as high as 10.8%, also helped by a midday rise in the price of bitcoin.
The company agreed to buy three “turnkey” sites – meaning they need only to plug their existing hardware into the facility – in Mississippi for $19.8 million in cash. That transaction will close within 21 days. The company expects the sites to support about 14% of its revenue shortly after closing.
Additionally, CleanSpark plans to acquire a facility in Dalton, Georgia, for an initial cash payment of $3.4 million. Then, it will invest another $3.5 million to complete the project by April. The facility will expand its presence in Dalton to three sites.
“Our move into Mississippi is all about growing our operations and diversifying our data center portfolio in a measured way,” CEO Zachary Bradford told CNBC. “Our operations in Georgia have given us significant experience in southeastern power markets. … Mississippi is in the same electric reliability region, so we see a lot of synergies there.”
The crypto industry has been expecting consolidation among bitcoin miners – particularly those that are smaller, have higher costs or older and less efficient hardware – as miner rewards are expected to be cut in half after the much-anticipated Bitcoin halving in the spring.
Bradford previously told CNBC that CleanSpark expects some miners to fall by the wayside after that point, adding that the company was eyeing potential facilities it could plug its own machines into easily. About a month ago, CleanSpark purchased 160,000 mining machines.
“The exciting thing about this expansion is that we’ll be able to quickly slot in our own servers so that we are operating almost immediately after closing the deal, shortening the path to ROI in a very attractive way,” he said Tuesday.
Generally, the mining stocks benefit from bitcoin price increases because those translate into higher mining revenue for the company.
Bitcoin miners were top performers in 2023, outperforming even bitcoin. CleanSpark gained about 440% last year, compared to bitcoin’s 157%.
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