Mr. Frank Holmes reports

HIVE DIGITAL PROVIDES AUGUST 2023 PRODUCTION AND REPORTS OVER 2.5X GROWTH IN AI COMPUTE INFRASTRUCTURE

Hive Digital Technologies Ltd. has released the unaudited production figures from the company's global bitcoin operations for the month of August, 2023, with 274 bitcoin produced in August. The company has maintained over 3.67 exahashes of bitcoin mining capacity on average for August, 2023, including ASIC and GPU BTC hash rate (all amounts in U.S. dollars unless otherwise indicated).

Summary overview:

• Hive produced 274 bitcoin in the month of August, from ASIC and GPU mining operations, representing an average of 74.7 bitcoin per exahash, with an average hash rate of 3.67 exahashes per second for the month of August, 2023.
• Hive produced an average of 8.8 BTC per day in August, 2023.
• Hive ended the month with 3.69 EH/s of mining capacity, including an ASIC and GPU BTC hash rate.

Artificial intelligence and HPC update

Aydin Kilic, president and chief executive officer of Hive, stated: "We are thrilled to announce our order of high performance SuperMicro servers, which will further increase our AI compute infrastructure capacity by over 2.5 times.

"The company notes it recently announced that its AI and HPC infrastructure compute tripled. Thus, this new order with SuperMicro further increases the compute capacity by a factor of 2.5 times. Once installed, these servers will provide the compute backbone to allow 2,400 of our Nvidia GPUs to perform AI and HPC compute, in addition to our 400 Nvidia GPUs, which were part of our successful beta test earlier this year, where we realized $1-million of annual run rate revenue. The company expects all these SuperMicro servers to be installed and operational by the end of October, 2023. This is a major milestone towards our year-end target of realizing $15-million of annual run rate revenue from this growing phase of our business.

"Additionally, we are excited to announce the expansion of our AI and HPC infrastructure offering into North America, in addition to our current operations in Sweden. Our North American AI and HPC infrastructure will be based in Canada, and the first servers are expected to come on-line in September. Hive is also excited to receive our enterprise-grade networking equipment, which will upgrade our AI and HPC servers in Sweden. This will allow 100 GBe interconnect speeds and will allow us to serve users with high-end AI and HPC compute demands. Enterprise-grade network equipment for our Canadian facility is expected to follow shortly thereafter.

"Where Hive has been a technology leader in crypto mining, our team with the knowledge and experience of operating a fleet of approximately 150,000 GPUs during the ethereum mining era now aspires to apply their expertise to the company's long-term blue-sky vision to implement our 38,000 Nvidia GPUs for HPC and AI workloads."

August, 2023, production figures

Mr. Kilic continued, "Our focus has been to upgrade our fleet of ASICs, as well as find new-generation ASICs available for immediate delivery, so they can be quickly installed to realize cash flow return on invested capital."

Luke Rossy, vice-president of operations, commented: "We expected to have an additional 1,700 BuzzMiners installed in New Brunswick in August. We have installed 300 BuzzMiners so far; however, 1,400 remain due to delays in our PDU upgrades. These are normal-course-of-business delays. We are happy to report progress where all of the 2,000 Bitmain S19 XP Antminers have been installed in our Lachute facility in Quebec. The acquisition of these machines was announced less than one month ago."

The company's total bitcoin production in August, 2023 was the following:

• 260 BTC produced from ASICs from an average hash rate of 3.5 EH/s from ASICs in August;
• 8.4 BTC produced per day on average from ASICs, and 74.7 BTC/EH from ASICs in August;
• 3.69 EH/s of BTC month-end hash rate as of Aug. 31, composed of 3.531 EH/s of ASIC BTC hash rate and 0.163 EH/s of GPU BTC hash rate;
• This represents a 1-per-cent month-over-month-end increase in BTC ASIC hash rate (July 31 month-end was 3.64 EH/s);
• Monthly average of 3.67 EH/s, composed of an average of 3.485 EH/s of ASIC mining capacity and average of 186 petahashes of bitcoin GPU mining capacity during the month of August;
• This is a 6-per-cent month-over-month increase in BTC average hash rate from ASICs and GPUs combined (July average BTC hash rate was 3.46 EH/s).

Bitcoin global network mining difficulty is volatile

Network difficulty factors are a significant variable in the company's gross profit margins. The bitcoin network difficulty was 52.33 T as of Aug. 1 and increased to an all-time high of 55.62 T as of Aug. 31. Accordingly, bitcoin mining difficulty ended the month about 6 per cent higher than the beginning of the month.

The bitcoin network difficulty is a publicly available statistic, which reflects the total number of bitcoin miners on-line and is important in analyzing a company's gross profit margins and number of bitcoin produced.

As more people mine bitcoin (difficulty increases), the daily bitcoin block reward, which currently is fixed at 900 bitcoin per day, gets split amongst more miners; thus, each miner receives a smaller portion of the block reward. Conversely, as bitcoin prices fall, many miners may lose money, and power down, thus taking their hash rate off the network, causing network difficulty to decrease.

Those miners with the lowest costs of production, by virtue of having more efficient machines and/or lower energy costs, are able to continue their production during these volatile cycles. Not all miners will continuously mine during the month. As a result, some miners will produce less bitcoin than expected, relative to their advertised hash rate. For the foregoing reasons, Hive will self-curtail part of its operations if the unhedged spot energy prices are uneconomical, thereby leaving part of its total gross hash rate unutilized.

All bitcoin miners are striving to use the most efficient bitcoin ASIC chips, and Hive is happy that it has been able to upgrade its global fleet during this crypto market downturn.

Clarification to Aug. 11, 2023, release

In the company's press release dated Aug. 11, 2023, it disclosed that, pursuant to the at-the-market equity program established by the prospectus supplement dated May 10, 2023, it had issued an aggregate of 534,400 common shares over the TSX Venture Exchange from the period between May 10, 2023, and June 30, 2023, at an average price of $4.92, and paid cash commission of $60,901. The company clarifies and confirms that the average price of the shares issued during this period pursuant to the May, 2023, ATM was $5.02, and the total commissions paid were $60,808.53.

About Hive Digital Technologies Ltd.

Hive went public in 2017 as the first cryptocurrency mining company listed for trading on the TSX Venture Exchange with a sustainable green energy focus.

Hive is a growth-oriented technology stock in the emergent blockchain industry. As a company whose shares trade on a major stock exchange, it is building a bridge between the digital currency and blockchain sector and traditional capital markets. Hive owns state-of-the-art, green-energy-powered data centre facilities in Canada, Sweden and Iceland, where it endeavours 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 its treasury of ETH and BTC derived from mining rewards. Its shares provide investors with 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 centres and advanced multiuse servers, it believes its shares offer investors an attractive way to gain exposure to the cryptocurrency space.

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