Blockchain Announces Growth Plan to 6 EH/S, Company Updates and Establishment of At-The-Market Equity Program

by Arthur · May 12, 2023

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This press release constitutes a “designated news release” for purposes of the Company’s prospectus supplement dated May 10, 2023 to the short form base shelf prospectus dated May 1, 2023.

Vancouver, British Columbia–(Newsfile Corp. – May 12, 2023) – HIVE Blockchain Technologies Ltd. (TSXV: HIVE) (NASDAQ: HIVE) (FSE: HBFA) (the “Company” or “HIVE”) is pleased to announce its updated growth target of 6 Exahash per second (“EH/s”) (all amounts in US dollars, unless otherwise stated).

HIVE’s short-term target is 4 Exahash for calendar Q2 2023 through secured orders of 1.26 Exahash from the new generation of Bitcoin mining ASICs, to increase our target hashrate by 33%. HIVE’s management team has carefully evaluated ASIC purchase opportunities, deployed capital for orders that will provide optimal cash flow returns on invested capital, while introducing more efficient machines to our global fleet.

Instant Growth Overview:

Strategic insight:

HIVE has successfully leveraged and continues to optimize its hybrid strategy for expansion, to opportunistically sell Bitcoin when appropriate to do so, or issue shares to increase our Bitcoin HODL position. HIVE’s approach to maximizing cash flow return on invested capital has allowed us to minimize shareholder dilution while maintaining a strong Bitcoin HODL balance sheet.

The company notes that other publicly traded Bitcoin miners can only issue shares to finance their operations and expansions, in order to HODL all their Bitcoin. While other miners may sell all Bitcoin HODL to fund their business or expansions.

Appointment of Luke Rossy as Vice President of Operations

HIVE is pleased to announce the appointment of Luke Rossy to the position of Vice President of Operations. Luke has been with HIVE for the past two years, as our Senior Developer & Operations Manager, where he has been a tremendous asset, and eager to learn.

Luke has demonstrated an ability to solve problems in the technical area, along with his expert level analytical skills. Expanding his horizons and taking on more leadership-level responsibilities, we are excited to see Luke grow with the company.

Aydin Kilic, CEO of HIVE Blockchain stated: “I have worked very closely with Luke over the past 2 years, he has been an exceptional team member, with incredible focus and a tireless work ethic. I believe he will be a great leader and as we have a lean leadership team at HIVE, his diverse skillset helps us navigate everyday obstacles as we strive for excellence.”

ATM financing to accelerate growth strategy and build HODL position

The Company is also pleased to announce that it has entered into an Equity Distribution (the “Share distribution agreement“) with Stifel GMP (“Stifel“) and Canaccord Genuity Corp. (“Canaccord“and together with Stifel,Agents“) to establish an offer on the market of ordinary shares (“Common shares“) in the Company’s capital at the facilities of the TSX Venture Exchange (“TSXV“).

Frank Holmes, Executive Chairman of HIVE commented: “I am thrilled that this is the first time that two large independent brokers in Canada are partnering with us on an ATM financing. This financing will allow us to increase our Bitcoin HODL and Exahash mining capacity.”

The company estimates that with every additional 30MW of infrastructure, using ASICs with an efficiency of 30 J/TH, it will be able to add 1 Exahash of Bitcoin mining capacity, at an approximate cost of $30,000,000. Therefore, given the right opportunities, the proceeds from the ATM funding could potentially enable the company to add another 3 Exahash to its operational footprint, including infrastructure and ASICs. This will represent approximately 100% growth to the company’s current ASIC operating capacity of 3.15 Exahash, to reach its growth target of 6 Exahash.

By introducing machines with better joule per Terahash (“J/TH”) efficiency, while acquiring these machines at an attractive $/TH price, we strive to optimize the short-term payback of our investments from cash flow operating these machines. Furthermore, we analyze possible scenarios where mining revenues may fall in the time periods around the halving event, and thus we strive for the machines we buy to have positive gross margins for as long as possible after the initial investment has been paid off. . Therefore, an optimal balance must be sought between realized J/TH efficiency and paid $/TH price. Our goal is for these investments to become free cash flow generating assets, to get the best cash flow return on invested capital as a listed Bitcoin miner.

Pursuant to the Stock Distribution Agreement, the Company may from time to time sell up to $100 million of Common Stock (the “ATM Equity Program“). The Company intends to use the net proceeds from the ATM Equity Program, if any, principally for general corporate and working capital requirements, financing ongoing operations, to repay outstanding indebtedness from time to time, to complete future acquisitions, or for other business purposes.

The common shares will be distributed at trading prices applicable at the time of sale, prices may vary between buyers and during the distribution period. The volume and timing of sales, if any, will be determined at the sole discretion of the Company’s management and in accordance with the terms of the Share Distribution Agreement. To date, no common shares have been distributed by the Company pursuant to the Share Distribution Agreement. Sales of common stock, if any, under the ATM Equity Program are expected to be made in transactions deemed to be “at-the-market distributions” as defined in National Instrument 44-102 – Shelf distributionsas sales directly on the TSXV or another recognized Canadian “market place” pursuant to National Instrument 21-101 – Marketplace operation. The ATM Equity Program is created pursuant to a prospectus supplement dated May 10, 2023 (the “Prospectus supplement“) to the Company’s short-form base shelf prospectus dated May 1, 2023 (the “Prospectus for base shelf“), filed with the securities regulatory authorities of each of the provinces and territories of Canada.

The prospectus supplement (as well as the related base shelf prospectus) is available on the company’s profile on the SEDAR website maintained by the Canadian Securities Administrators at www.sedar.com.

This news release does not constitute an offer to sell or the solicitation of an offer to buy securities in the United States or in any jurisdiction where the offer, sale or solicitation would be illegal. The common shares referred to in this press release may not be offered or sold in the United States without registration or an applicable exemption from registration.

About HIVE Blockchain Technologies Ltd.

HIVE Blockchain Technologies Ltd. went public in 2017 as the first cryptocurrency mining company listed for trading on the TSX Venture Exchange with a focus on green energy.

HIVE is a growth-oriented technology share in the emerging blockchain industry. As a company whose shares are traded on a major exchange, we are building a bridge between the digital currency and blockchain sector and traditional capital markets. HIVE owns state-of-the-art, green energy-powered data center facilities in Canada, Sweden and Iceland, where we seek to source green energy to mine digital assets such as Bitcoin on the cloud. Since the beginning of 2021, HIVE has held in secure storage the majority of the treasury of ETH and BTC derived from mining rewards. Our shares give investors exposure to the operating margins of digital currency mining, as well as a portfolio of Bitcoin. Because HIVE also owns hard assets such as data centers and advanced multipurpose servers, we believe our shares offer investors an attractive way to gain exposure to the cryptocurrency space.

We encourage you to visit HIVE’s YouTube channel here to learn more about HIVE.

For more information and to sign up for 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”

Executive Chairman

For more information please contact:

Frank Holmes

Phone: (604) 664-1078

Neither the TSX Venture Exchange nor its regulatory services provider (as that term is defined in the 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 press release contains “forward-looking information” within the meaning of applicable Canadian securities laws that is based on expectations, estimates and projections as of the date of this press release. “Forward-looking information” in this news release includes, but is not limited to, business goals and objectives of the Company; ATM Equity Program; The HODL strategy adopted by the company; acquisition, deployment and optimization of the mining fleet and equipment; the continued viability of its existing Bitcoin mining operations; and other forward-looking information about the intentions, plans and future actions of the parties to the transactions described herein and the terms thereof.

Factors that could cause actual results to differ materially from those described in such forward-looking information include, but are not limited to, the volatility of the digital currency market; the Company’s ability to successfully mine digital currency; The Company may not be able to profitably liquidate its current digital currency holdings as needed, or at all; a material decline in digital currency prices could have a material adverse effect on the Company’s business; the volatility of digital currency prices; continued effects of the COVID-19 pandemic could have a material adverse effect on the Company’s performance as supply chains are disrupted and prevent the Company from executing its expansion plans or operating its assets; and other related risks as more fully described in the Company’s registration statement and other documents disclosed in the Company’s filings at www.sec.gov/EDGAR and www.sedar.com.

The forward-looking information in this press release reflects the company’s current expectations, assumptions and/or beliefs based on information available to the company. In connection with the forward-looking information in this press release, the company has made assumptions about the company’s goals, objectives or future plans, the timing of these and related matters. The company has also assumed that no significant events occur outside the company’s normal operations. Although the Company believes that the assumptions contained in the forward-looking information are reasonable, forward-looking information is not a guarantee of future performance and, accordingly, such information should not be relied upon due to the inherent uncertainty therein. The company disclaims any intention or obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, other than as required by law.

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