Mr. Frank Holmes reports

HIVE DIGITAL ANNOUNCES PURCHASE OF 4,800 BITMAIN S19K PRO ASIC MINERS AND PROVIDES STRATEGIC UPDATE

Hive Digital Technologies Ltd. has provided an update on its bitcoin mining strategy and has purchased 4,800 Bitmain S19k Pro ASIC miners (all amounts are in U.S. dollars, unless otherwise indicated).

Hive has purchased 4,800 Bitmain S19k Pro ASIC miners for expected delivery within 30 days, which will allow it to upgrade a portion of its fleet to improve its average joule-per-terahash efficiency. With quick delivery, these miners will cash flow quicker. The company also expects these latest-generation miners to be cash flow positive after the bitcoin halving event next year.

Its goal is to upgrade its remaining 38 J/TH miners to 23 J/TH before the halving, which is expected to be in late April, 2024. The lower the J/TH means the greater the machine efficiency. Its strategy is to upgrade monthly, with new ASIC machines which are available for rapid delivery, with attractive dollar per tetahash prices. Hive is making good strides toward this goal.

As Hive strategically prepares for the halving, it has performed extensive analysis to navigate these volatile markets. This will include further purchases of high-efficiency ASIC miners to upgrade and expand its ASIC fleet. The Hive management team has unique experience managing both the last bitcoin halving ecosystem in 2020 and the merge of ethereum proof of work to proof of stake in 2022. A key compass for the Hive team is to focus on the cost of capital to generate the highest returns on its investments in ASIC machines.

Including this new acquisition, the company notes that in the last six months, Hive has purchased 8,900 new-generation ASICs, including the 3,100 units of the Bitmain S19 XP and 5,800 units of the S19k Pro, which have efficiencies of approximately 22 J/TH and 23 J/TH, respectively, all with quick delivery timelines and very attractive dollar per terahash prices. Its strategy is to maximize cash flow return on invested capital for bitcoin ASICs; thus, its goal is to make investments that are accretive to its shareholders.

Similarly, last November, in the wake of the FTX scandal, when S19j Pro miners for quick delivery were available for as low as $11 per TH, Hive purchased 3,570 machines, which had all been installed within weeks of payment being issued, and as of today have earned approximately 90 per cent to 120 per cent in cash flow of their purchase price (after accounting for electrical operating costs), and these assets are thus soon to be completely free cash flowing.

Hive has maintained 1 per cent of the bitcoin network, currently producing over nine bitcoin per day, with 4.1 exahashes per second of ASIC operating capacity. Hive's new acquisition of 4,800 S19k Pro ASICs will further increase this operating hash rate once they are installed.

Using data from FactSet, in the last year, the five largest bitcoin miners with U.S. operations have averaged over 65-per-cent shareholder dilution to expand their fleet while Hive has managed to acquire over 23,000 new bitcoin mining ASICs in the last year with only 5-per-cent dilution. These ASICs include Hive BuzzMiners, along with the Bitmain S19j Pro, S19k Pro, S19 Pro Plus and the S19 XP. Hive has used these ASICs to upgrade older legacy ASICs while increasing its bitcoin ASIC hash rate by 70 per cent from 2.4 EH/s a year ago in November, 2022, to 4.1 EH/s as of November, 2023 (this does not include the supplementary hash rate from its GPUs, which is an additional 130 petahashes per second of bitcoin mining capacity).

This is one example of executing its strategy to focus on cash flow return on invested capital in making financial decisions. These figures represent operational hash rate, with its most efficient profitable machines plugged in, and the company has an additional inventory of ASICs which it may use for future expansion, as it evaluates opportunities for additional megawatt capacity.

With over 23,000 bitcoin mining ASICs purchased and installed in the last year, plus 1,000 Hive BuzzMiners and the 4,800 Bitmain S19k Pros, which have been ordered and are arriving in the next 30 days, Hive has strategically procured over 29,000 bitcoin ASIC miners since November, 2022. This reflects its strategic and analytical approach to secure the best opportunities for its shareholders, as opposed to making large orders all at once and risking dilution.

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 and high performance computing industry. As a company whose shares trade on major stock exchanges, it is building a bridge between the digital currency and blockchain sectors 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 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 and high performance computing space.

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