Mr. Frank Holmes reports
HIVE BLOCKCHAIN ANNOUNCES LATE FILING OF ANNUAL FINANCIAL STATEMENT
As a result of delays in the completion of its audit, Hive Blockchain Technologies Ltd. will be unable to file its financial statements and accompanying management's discussion and analysis for the financial year ended March 31, 2021, by July 29, 2021, being the date that such filings are due under applicable Canadian securities law requirements. The late filing is the result of operational and reporting challenges associated with the consolidation of the five countries that the company operates in: Sweden, Canada, Switzerland, Bermuda and Iceland.
Maintaining operations in so many different jurisdictions allows the company to diversify its holdings and access low-cost green power in stable areas. However, it also brings reporting complications as each country has its own unique requirements. To address these, the company is streamlining financial processes to facilitate faster auditing and reporting. In addition, earlier this year, it exited Norway and, in the past 18 months, has bought two data centre operations in New Brunswick and Lachute, Canada, which are familiar jurisdictions to its financial team.
Other factors contributing to the reporting delay include unexpected accounting and logistical delays associated with the previously announced Sweden GPU facility upgrade process, and in obtaining financial reporting and analysis from the company's wholly owned subsidiaries in Sweden, which have recently undergone a corporate reorganization to simplify its operating structure moving forward. It believes this new corporate structure in Sweden will resolve these reporting delays and benefit shareholders over all, with certain tax benefits expected.
This reorganization of the company's Swedish operation, which is where most of the company's GPU mining operations are located, will provide a better corporate structure as the company moves into high performance computing (HPC) cloud hosting. In the future, Hive will use its high-end GPUs, which currently mine ethereum, to provide HPC cloud hosting for tasks that require substantial GPU processing power, such as simulations, artificial intelligence, machine learning and gaming. This shift to cloud HPC hosting will depend on the timing of the launch of ethereum 2 (Eth2), which is a planned upgrade to ethereum that is expected to make mining ETH obsolete. The Eth2 upgrade has been delayed for years, and the company does not know exactly when it will take place, if at all. You can read more about the company's HPC strategy in a prior press release.
In response to the reporting delay, the company has applied for a management cease trade order by the B.C. Securities Commission restricting the company's chief executive officer and chief financial officer from trading the company's shares until the annual filings are filed. The company currently expects to file the annual filings on or before Aug. 12, 2021, and will issue a press release announcing completion of these filings at such time. Until the company files the annual filings, it will comply with the alternative information guidelines set out in National Policy 12-203 (Management Cease Trade Order). The guidelines, among other things, require the company to issue biweekly default status reports by way of a news release for as long as the annual filings have not been filed. During the MCTO, the general investing public will continue to be able to trade in the company's shares.
The company will keep investors updated as it moves through this process.
About Hive Blockchain Technologies Ltd.
Hive Blockchain went public in 2017 as the first cryptocurrency mining company with a green energy and ESG (environmental, social and governance) strategy.
Hive is a growth-oriented technology stock in the emergent blockchain industry and has been profitable every quarter for the past year. 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 sources only green energy to mine on the cloud and hodl both ethereum and bitcoin. Since the beginning of 2021, Hive has held in secure storage most of its ETH and BTC coin mining rewards. Its shares provide investors with exposure to the operating margins of digital currency mining, as well as a portfolio of cryptocurrencies such as ETH and BTC. 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. Hive traded over two billion shares in 2020.
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