Bit Digital, a worldwide platform for excessive-performance computing (HPC) infrastructure and digital asset mining firm, has launched plans to lift as a lot as $500 million thru an at-the-market (ATM) equity offering.
The fundraising pass by the firm is an strive to steal its expansion into HPC and cloud services and products, as outmoded Bitcoin mining turns into less winning due to tightening margins.
The proposed ATM offering would enable Bit Digital to insist and promote shares of its same old stock over time thru funding financial institution H.C. Wainwright & Co., that can perhaps perhaps maybe act because the sales agent and receive a commission of as a lot as three% on any shares sold.
The offering’s measurement is bigger than Bit Digital’s latest market capitalization of roughly $429 million, and may perhaps perhaps doubtlessly require present shareholders to dilute their holdings.
Based on Bit Digital, the proceeds from the offering will most certainly be same old for same old company purposes, at the side of capital expenditures on new mining and cloud servicing equipment, working capital, and doable acquisitions.
This fundraising initiative comes amid sturdy economics for Bitcoin miners with challenges such because the 2024 Bitcoin halving occasion, community disorders, and rising operational charges.
Mining firms diversify to adjoining sectors
In response, many mining firms bear pursued equity choices, debt financing, or convertible notes to enhance operations and pivot into adjoining sectors esteem AI and HPC. Within the fourth quarter of 2024 alone, public mining firms raised over $1.6 billion by capability of equity financing and better than $4.6 billion by capability of debt financing.
Bit Digital’s pivot involves investments in HPC and cloud services and products. In October 2024, the firm received Enovum Data Centers, a Tier 3 HPC recordsdata heart operator, for roughly CAD $62.8 million (USD $46 million).
Additionally, Bit Digital entered correct into a grasp service agreement (MSA) with Boosteroid Inc., with out a doubt one of the largest cloud gaming services, in August 2024. The agreement initiated an initial deployment of 300 GPUs expected to generate approximately $4.6 million in earnings over 5 years.
Cloud and HPC services and products to the rescue as mining falters
For its 2024 fiscal 365 days story, Bit Digital reported a total earnings of $108.1 million, a 141% magnify from the prior 365 days’s outcomes. Bit Digital attributed the magnify to the commencement of its HPC services and products industry. The firm’s liquidity stood at approximately $260.7 million, with shareholders’ equity of $463.5 million.
It additionally made $58.6 million from Bitcoin mining, which became a 32% magnify from 2023. Cloud services and products accounted for $Forty five.7 million in 2024. As a result of its acquisition of Enovum Data Corp, it made $1.4 million from colocation services and products. Its ETH staking earnings elevated by 169% after it introduced in $1.8 million in earnings.
Digital Asset mining accounted for 54% of Bit Digital’s earnings source in 2024, which is a indispensable contrast from 2023, where it became guilty for 98% of the firm’s earnings.
Bit Digital’s HPC industry traces, along with its cloud services and products, generated 42% of its earnings for 2024, with a indispensable a part of the haul coming throughout the fourth quarter of the 365 days.
