DMG Blockchain Solutions Announces Preliminary December Mining Results and Year in Review

Rhea-AI Summary

DMG Blockchain Solutions reported its December 2024 mining results, achieving 32 BTC mined with a hashrate of 1.68 EH/s and total Bitcoin holdings of 406 BTC. For Q4 2024, the company mined 97 bitcoin with an average hashrate of 1.62 EH/s and fleet efficiency of 23 J/TH.

The company grew its hashrate by over 70% in 2024, reaching 1.72 EH/s by year-end. DMG plans to expand to 2.1 EH/s in early 2025 using hydro direct liquid cooling technology, with a target of 3 EH/s by end of 2025. The company utilized a USD $19M loan facility from Sygnum Bank, drawing $9.4M with 295 bitcoin as collateral, and raised CAD $17.3M in equity funding.

Key initiatives include a partnership with Malahat Nation for 30MW of Gen AI compute capacity, development of the Systemic Trust platform for qualified custody, and enhancement of Terra Pool software for carbon-neutral Bitcoin ecosystem.

Positive

• Q4 2024 bitcoin mining increased 50% from previous quarter
• Hashrate grew over 70% in 2024, reaching 1.72 EH/s
• Secured USD $19M loan facility and raised CAD $17.3M in equity
• 406 BTC holdings provide additional loan facility drawing power
• Planned expansion to 2.1 EH/s with improved fleet efficiency of 21 J/TH

Negative

• Significant capital expenditure required for planned expansions
• 295 BTC locked as loan collateral

VANCOUVER, British Columbia, Jan. 06, 2025 (GLOBE NEWSWIRE) -- DMG Blockchain Solutions Inc. (TSX-V: DMGI) (OTCQB: DMGGF) (FRANKFURT: 6AX) ("DMG" or the "Company"), a vertically integrated blockchain and data center technology company, today announces its preliminary mining results for December 2024.

• Bitcoin Mined: 32 BTC
• Hashrate: 1.68 EH/s
• Bitcoin Holdings: 406 BTC
  

For the December 2024 quarter, DMG mined 97 bitcoin with an average hashrate of 1.62 EH/s and a fleet efficiency of 23 J/TH.

“DMG’s CEO, Sheldon Bennett commented, “December capped a significantly stronger quarter versus the prior quarter, as DMG mined approximately 50% more bitcoin at a greater fleet efficiency. We are now focused on expanding our hashrate to 2.1 EH/s in the current quarter based on utilizing leading edge hydro direct liquid cooling (DLC) technology. We expect to energize our first hydro container in the current month and the remaining five containers in the current quarter.”

As this is DMG’s first press release of calendar 2025, we would like to use this opportunity to reflect on our accomplishments over the past 12 months and lay out our vision for what we expect to achieve in the next 12 months.

Key Accomplishments over the Past Year and Coming Year Goals

• Bitcoin Mining - grew hashrate more than 70% from less than 1 EH/s in Jan-Sep 2024 and exited calendar 2024 with 1.72 EH/s with a fleet efficiency of 23 J/TH
  • Purchased hydro Bitcoin mining equipment to grow to 2.1 EH/s with an expected fleet efficiency of 21 J/TH in early calendar 2025
  • Goal to grow to 3 EH/s in calendar 2025
• Generative Artificial Intelligence (Gen AI) - executed memo of understanding (MOU) with the Malahat Nation to build 30 megawatts of Gen AI compute capacity
  • Working towards a definitive agreement in conjunction with setting up offtake agreements and execution partners
• Systemic Trust - executed software platform and achieved regulatory milestones towards becoming a qualified custodian in early calendar 2025
  • Focus on customer acquisition and platform expansion beyond custody in calendar 2025
• Terra Pool - rebuilt software to utilize the same enterprise-grade best practices as for Systemic Trust to ensure the best possible client experience and enable our carbon neutral Bitcoin ecosystem
  • Focus on customer acquisition and integration of Reactor in calendar 2025
• Reactor software platform acquired - purchased from Navier in October 2024 for assuring the delivery of hashrate over the term of a hashrate contract
• Helm - rebuilding the software to be a Bitcoin Data Center Infrastructure Management (DCIM) tool, with a focus on supporting next generation fleets, optimizing operation and working with demand response programs
  • Released the first version for internal use in December 2024
  • Goal to build a powerful Bitcoin DCIM tool for Terra Pool clients in calendar 2025
    

Capital Raising over the Past Year

Over the past 12 months, DMG has utilized a USD $19 million loan facility from Sygnum Bank, for which it is utilizing 295 bitcoin as collateral and has drawn USD $9.4 million as of September 30, 2024. DMG has utilized its loan facility primarily for capital expenditures including the purchase of its 4,550 Bitmain T21 miners, which have expanded its hashrate by 0.9 EH/s, as well as subsequent capital purchases. DMG’s bitcoin collateral could enable it to draw most or all of the loan facility amount at current bitcoin prices. In addition, in November 2024, the Company raised CAD $17.3 million in share equity, with the proceeds used for purchasing its 6-megawatt hydro Bitcoin mining fleet to expand its hashrate by 0.4 EH/s as well as other corporate purposes. The Company’s ability to raise capital has enabled it to remain competitive in Bitcoin mining while positioning itself to capitalize on its Gen AI opportunities, all the while advancing its software and services initiatives.

Our Vision for the Coming Year

This past year has been transformational for DMG, as we executed the enabling software for the two key elements of our carbon neutral Bitcoin ecosystem - Systemic Trust and Terra Pool. Accordingly, we are very encouraged that calendar 2025 becomes the breakout year for our Core+ strategy. We are now making a transition from development to a focus on customer acquisition and operational execution going forward.

We expect Gen AI to become a major driver of our Core strategy over the next several years. We will be devoting significant resources and capital to realize our opportunity with the Malahat Nation while simultaneously looking to make this a pan-Canadian effort among multiple indigenous bands. We will be leveraging our unique relationships while capitalizing on this special time in the data center industry to be part of the growth of tens of gigawatts of Gen AI data centers being built throughout North America over the next several years.

Bitcoin mining will remain foundational to our Core strategy. Bitcoin mining is less than one-tenth the capital intensity of Gen AI, can be deployed in one-third the time and has a payback period that is typically one-half to one-third the time; we are agnostic between the two technology types as to how we maximize returns, and we see a role for both technologies to be utilized, even at the same data center site. Bitcoin mining achieves faster time to revenue, while Gen AI can be layered in more gradually as multi-year offtake agreements are established.

While we have made great progress over the past year and have done so in a capital efficient manner, we have much to deliver in the coming year. We appreciate and value your continued support.

About DMG Blockchain Solutions Inc.

DMG is a publicly traded and vertically integrated blockchain and data center technology company that manages, operates and develops end-to-end digital solutions to monetize the digital asset and artificial intelligence compute ecosystems. DMG’s sustainable businesses are segmented into two business lines under the Core and Core+ strategies and unified through DMG’s vertical integration.

For more information on DMG Blockchain Solutions visit: www.dmgblockchain.com
Follow @dmgblockchain on X, LinkedIn, Facebook and subscribe to DMG's YouTube channel.

For further information, please contact:

On behalf of the Board of Directors,

Sheldon Bennett, CEO & Director
Tel: +1 (778) 300-5406
Email: investors@dmgblockchain.com
Web: www.dmgblockchain.com

For Investor Relations:
investors@dmgblockchain.com

For Media Inquiries:
Chantelle Borrelli
Head of Communications
chantelle@dmgblockchain.com

Neither the TSX Venture Exchange nor its Regulation Service Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this news release.

Cautionary Note Regarding Forward-Looking Information

This news release contains forward-looking information or statements based on current expectations. Forward-looking statements contained in this news release include statements regarding DMG’s strategies and plans, the development of Systemic Trust and becoming a qualified custodian, improving fleet efficiency and continuing to execute on Core+ software initiatives, onboarding of new clients to Terra Pool, executing a definitive agreement with the Malahat Nation, customer acquisition for Terra Pool and the integration of Reactor, build a DCIM tool, the opportunity and plans to monetize bitcoin transactions and provide additional products and services to customers and users, the continued investment in Bitcoin network software infrastructure and applications, the expected allocation of capital, developing and executing on the Company’s products and services, increasing self-mining, increasing hashrate, energizing the first hydro container in the current month and the remaining five containers in the current quarter, achieving its goal of 3 EH/s in the 2025 calendar year, efforts to improve the operation of its mining fleet, the launch of products and services, events, courses of action, and the potential of the Company’s technology and operations, among others, are all forward-looking information.

Future changes in the Bitcoin network-wide mining difficulty rate or Bitcoin hashrate may materially affect the future performance of DMG’s production of bitcoin, and future operating results could also be materially affected by the price of bitcoin and an increase in hashrate mining difficulty.

Forward-looking statements consist of statements that are not purely historical, including any statements regarding beliefs, plans, expectations, or intentions regarding the future. Such information can generally be identified by the use of forwarding-looking wording such as "may", "expect", "estimate", "anticipate", "intend", "believe" and "continue" or the negative thereof or similar variations. The reader is cautioned that assumptions used in the preparation of any forward-looking information may prove to be incorrect. Events or circumstances may cause actual results to differ materially from those predicted, as a result of numerous known and unknown risks, uncertainties, and other factors, many of which are beyond the control of the Company, including but not limited to, market and other conditions, volatility in the trading price of the common shares of the Company, business, economic and capital market conditions; the ability to manage operating expenses, which may adversely affect the Company's financial condition; the ability to remain competitive as other better financed competitors develop and release competitive products; regulatory uncertainties; access to equipment; market conditions and the demand and pricing for products; the demand and pricing of bitcoin; the demand and pricing of Gen AI data centers and usage; security threats, including a loss/theft of DMG's bitcoin; DMG's relationships with its customers, distributors and business partners; the inability to add more power to DMG's facilities; DMG's ability to successfully define, design and release new products in a timely manner that meet customers' needs; the ability to attract, retain and motivate qualified personnel; competition in the industry; the impact of technology changes on the products and industry; failure to develop new and innovative products; the ability to successfully maintain and enforce our intellectual property rights and defend third-party claims of infringement of their intellectual property rights; the impact of intellectual property litigation that could materially and adversely affect the business; the ability to manage working capital; and the dependence on key personnel. DMG may not actually achieve its plans, projections, or expectations. Such statements and information are based on numerous assumptions regarding present and future business strategies and the environment in which the Company will operate in the future, including the demand for its products, the ability to successfully develop software, that there will be no regulation or law that will prevent the Company from operating its business, anticipated costs, the ability to secure sufficient capital to complete its business plans, the ability to achieve goals and the price of bitcoin. Given these risks, uncertainties, and assumptions, you should not place undue reliance on these forward-looking statements. The securities of DMG are considered highly speculative due to the nature of DMG's business. For further information concerning these and other risks and uncertainties, refer to the Company’s filings on www.sedarplus.ca. In addition, DMG’s past financial performance may not be a reliable indicator of future performance.

Factors that could cause actual results to differ materially from those in forward-looking statements include, failure to obtain regulatory approval, the continued availability of capital and financing, equipment failures, lack of supply of equipment, power and infrastructure, failure to obtain any permits required to operate the business, the impact of technology changes on the industry, the impact of viruses and diseases on the Company's ability to operate, secure equipment, and hire personnel, competition, security threats including stolen bitcoin from DMG or its customers, consumer sentiment towards DMG's products, services and blockchain and Gen AI technology generally, failure to develop new and innovative products, litigation, adverse weather or climate events, increase in operating costs, increase in equipment and labor costs, equipment failures, decrease in the price of Bitcoin, failure of counterparties to perform their contractual obligations, government regulations, loss of key employees and consultants, and general economic, market or business conditions. Forward-looking statements contained in this news release are expressly qualified by this cautionary statement. The reader is cautioned not to place undue reliance on any forward-looking information. The forward-looking statements contained in this news release are made as of the date of this news release. Except as required by law, the Company disclaims any intention and assumes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. Additionally, the Company undertakes no obligation to comment on the expectations of or statements made by third parties in respect of the matters discussed above.

FAQ

What were DMG Blockchain Solutions (DMGGF) mining results for December 2024?

In December 2024, DMG mined 32 BTC with a hashrate of 1.68 EH/s and maintained Bitcoin holdings of 406 BTC.

How much did DMGGF's hashrate grow in 2024?

DMG's hashrate grew by more than 70% in 2024, from less than 1 EH/s to 1.72 EH/s by year-end.

What is DMGGF's hashrate expansion target for 2025?

DMG plans to expand its hashrate to 2.1 EH/s in early 2025 and aims to reach 3 EH/s by the end of 2025.

How much capital did DMGGF raise in 2024?

DMG secured a USD $19M loan facility from Sygnum Bank and raised CAD $17.3M through share equity in November 2024.

What is DMGGF's partnership with Malahat Nation?

DMG has an MOU with Malahat Nation to build 30 megawatts of Generative AI compute capacity and is working towards a definitive agreement.