Bit Digital, Inc. (BTBT) stock prices skyrocketed by a massive 26.16% shortly after market trading commenced on June 14th 2021, bringing the price up to USD$9.77 early on in the trading day.
Meme Stock Phenomenon
With the recent proliferation of the meme stock craze taking over stock markets, akin to the GME and AMC episodes from earlier in the year, BTBT seems to be the latest target of the meme stock phenomenon. In the absence of any significant news or developments, the recent surge in PROG stock prices is likely to be attributable to the coordinated pump by investors who are users of the popular social media platform, Reddit.
Agreement with Digihost
The company recently announced entering into a strategic co-mining agreement with Digihost Technology Inc (DGHI). As per the agreement, DGHI will provide certain premises to BTBT to facilitate the operation and storage of a 20 MW Bitcoin mining system that will be delivered by BTBT. DGHI will also facilitate the provision of services to maintain the premises for a term of two years. The collaborative efforts of both companies are forecasted to result in an increased generation of hashrate in the amount of almost 400 PH between the two.
Terms of Agreement
As per the agreement, DGHI will be responsible or the provision of power for the operation of the Miners, as well as for management services that will be essential in maintaining the planned 95% uptime on the Miners. In return, DGHI will be paid a very competitive rate for power. The two companies will also participate in a profit sharing arrangement based on a fixed distribution formula. The delivery and installation of the Miners is expected for the fourth quarter of the fiscal year 2021.
Scope of Agreement
The company expects an increase in hashrate of 400 PH between them, based on current Bitcoin metrics, which will signal a massive collaborative success on the part of the joint venture. BTBT continues to expand its business strategy through the expansion of the company’s mining infrastructure, vertical integration of low-cost and green sources of energy, strategic partnerships within the blockchain sector, and geographic diversification across North America. These steps serve to strategically operating the business in regions where the carbon footprint being generated is minimal or non-existent.
Future Outlook for BTBT
Armed with a potentially lucrative strategic partnership, as well as the fortuitous surge in the value of their equity, BTBT is poised to capitalize on the opportunities presented to it. The company is keen to continue its trajectory of success and usher in more organic growth over the long-term. Current and potential investors are hopeful that the management will leverage the resources at their disposal to facilitate significant and sustained increases in shareholder value.