Mr. Frank Holmes reports

HIVE DIGITAL PROVIDES OCTOBER 2023 PRODUCTION UPDATE AND REACHES 4 EXAHASH TARGET

Hive Digital Technologies Ltd. has released the unaudited production figures from the company's global bitcoin operations for the month of October, 2023, with 265.9 bitcoin produced in October. The company has maintained over 3.94 exahashes per second of bitcoin mining capacity on average for October, 2023, including ASIC and GPU BTC hash rate (all amounts in U.S. dollars, unless otherwise indicated).

Summary overview:

• Hive produced 265.9 bitcoin in the month of October, from ASIC and GPU mining operations, representing an average of 67.5 bitcoin per exahash, with an average hash rate of 3.94 EH/s for the month of October, 2023.
• Hive produced an average of 8.6 BTC per day, from ASIC and GPU mining operations, in October, 2023.
• Hive ended the month with 3.97 EH/s of mining capacity, from ASIC mining capacity, and GPU BTC hash rate consistent month-over-month increase.
• Hive exceeded 4.0 exahashes from ASIC mining capacity on certain dates throughout the month, achieving a peak of approximately 4.13 exahashes from a combined ASIC and GPU mining capacity. Throughout October, the total hash rate has fluctuated due to reconfigurations at its various data centres and the arrival of new machines.

Bitcoin halving strategy

Frank Holmes, executive chairman of the company, stated: "Hive was the first publicly listed crypto miner, listing on the [TSX Venture Exchange] in 2017, and since then, we skillfully and successfully navigated the last halving event in 2020, and additionally, the bear markets of 2019, 2020, 2022 and what we are experiencing currently. Our team's proven track record, coupled with our fiscal prudence, puts us in an enviable position to weather the halving event, which is currently expected to occur mid-April, 2024. Our continued focus is to maximize the [return on investment] on bitcoin mining ASICs we purchase now by making strategic acquisitions of only the very best offers in the market."

Bitcoin ASIC target of 4.0 exahashes reached

Aydin Kilic, president and chief executive officer of Hive, stated: "We are very pleased to have reached 4.0 exahash this month from ASIC mining operations as we continue to optimize our fleet within existing infrastructure. In addition, a portion of our GPUs are still mining alt-coins with which we are paid in bitcoin. The equivalent bitcoin hash rate from our GPUs in the month of October was 130 PH/s.

"We continue to seek bitcoin miner ASIC purchase opportunities that will provide the best return invested capital as we prepare for the upcoming halving event. We, as a company, carefully measure the break-even mining economics of the different models of machines available while also optimizing our existing fleet with firmware optimizations where possible."

October, 2023, production figures

The company's total bitcoin production in October, 2023, was:

• 257 BTC produced from ASICs from an average hash rate of 3.81 EH/s from ASICs in October;
• 8.3 BTC produced per day on average from ASICs and 67.5 BTC/EH from ASICs in October;
• 3.97 EH/s of BTC month-end hash rate as of Oct. 31, composed of 3.834 EH/s of ASIC BTC hash rate and 0.136 EH/s of GPU BTC hash rate;
• Its October production figures represent a 0.2-per-cent month-over-month increase in BTC ASIC hash rate (Sept. 30 month-end was 3.825 EH/s);
• Monthly average of 3.94 EH/s, composed of an average of 3.81 EH/s of ASIC mining capacity and an average of 130 PH/s of bitcoin GPU mining capacity during the month of October;
• Its October production figures represent a 3-per-cent month-over-month increase in BTC average hash rate from ASICs and GPUs combined (September average BTC hash rate was 3.83 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 57.12 T as of Oct. 1 and increased to an all-time high of 62.46 T as of Oct. 31. Accordingly, bitcoin mining difficulty ended the month about 9 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 the number of bitcoin produced. These data are available on many websites.

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.

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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