DMG Blockchain Solutions Inc. (TSX-V: DMGI) (DMGGF:OTC US)
(FRANKFURT:6AX) (“DMG” or the “Company”), a vertically integrated
blockchain and cryptocurrency technology company, is pleased to
provide its shareholders with its business outlook for 2021.
Not since late 2018 has the general crypto
industry attracted so much attention; however, this new bull run is
decidedly different from the past as institutions such as Paypal,
BlackRock, and AllianceBernstein are all taking positions,
predominantly in Bitcoin. With institutional investors driving
crypto forward instead of retail, as it was in 2017 and 2018, it is
anticipated that governments and regulators are not far behind. In
order for the economic scale which institutional investors bring,
financial compliance must go hand-in-hand. DMG’s previous
acquisition of Blockseer is focused on compliance and good
governance, putting it at the forefront of DMG’s 2021-2022 growth
strategy, along with its core crypto mining operations and
third-party hosting services.
Many DMG shareholders may not realize that DMG
is not just a crypto mining company. Rather, it is a full-service,
vertically integrated blockchain company. DMG possesses core assets
that begin with its 85MW power substation and 27,000 sq. ft. data
centre in British Columbia, Canada. DMG’s Mine Manager software
optimizes mining operations, and DMG’s Blockseer Pool was created
to meet the U.S. Government’s Office of Foreign Assets Control
(OFAC) compliance for Bitcoin addresses, as well as providing the
utmost level of transparency, auditability, and corporate
governance. DMG plans to monetize this cryptocurrency pool in
partnership with Marathon Patent Group Inc. and other potential
large scale mining companies. DMG’s vertical integration will
continue with the release of additional software products built
upon the Blockseer brand, which are focused on bringing its clients
deeper into DMG’s value-added services beyond the Company’s core
crypto mining operations.
DMG’s Development Plans for
2021
In order to position the Company for anticipated
future changes within the cryptocurrency industry in general and
the Bitcoin mining industry in particular, DMG’s management is
actively involved in further developing its corporate growth
strategy and adjusting it to the ever-changing market environment,
aiming at becoming one of the leading innovation forces in this
market. Therefore, the following recent corporate developments and
efforts are the foundation of this long-term and profit-oriented
strategy for growth:
Focusing on DMG’s Core Business -
Christina Lake Data Center DMG’s 2021 focus for its
Christina Lake crypto mining operations is to complete its
previously announced retrofitting from air to immersion cooling,
increasing both its hosting and self-mining operations, as well as
to provide DMG flexibility in managing capital expenditures.
Christina Lake Data Center - Immersion
RetrofittingPrototyping and testing of immersion has shown
miner hashing rates increase up to 30%, allowing for significant
reductions in the number of miners running for the same hashing
performance. With the rising price and supply shortages of crypto
miners, having the capital to deploy is just as important as
deploying in immersion cooling to ensure mining performance is
optimized for every dollar spent. Immersion cooling is not only
reducing the number of miners needed to reach hashrate goals, but
also extending the life of these assets and conserving the power
used to run air cooling fans. DMG will provide further updates on
this immersion cooling technology in the future after further
testing is completed.
DMG will continue its testing in Q1 2021 as it
begins major retrofitting of the data center from air cooling to
immersion cooling. Through focusing on engineering, DMG will not
need to alter the existing low voltage infrastructure used in air
cooing. Instead, it will use the same footprint and incorporate
immersion cooling tanks and piping, which are expected to save
significantly on retrofitting costs and shorten time lines
substantially.
“Our future crypto mining efficiency will be
extraordinarily high, as we combine immersion cooling with
Blockseer’s Mine Manager automation and DMG’s seasoned technical
team operating the Christina Lake Data Center. I believe DMG will
be challenging the crypto industry in the hashrate we will be
producing relative to our power consumption and operational costs,”
said DMG’s CTO, Adrian Glover. “For example, if any given number of
miners would generate 1,000 petahash without immersion cooling, DMG
is going to be able to realize at least 1,300 petahash from the
exact same set of miners by implementing our immersion cooling
technology.”
With the move to immersion cooling, DMG aims to
maximize its revenue on future self-mining as well as be able to
charge a premium for hosted clients who would prefer the advantages
of immersion cooling without the added capital cost of constructing
themselves.
Christina Lake Data Center - Self
MiningDMG’s self-mining operations have benefited from
continued growth in Bitcoin value, allowing for increased
profitability from older mining equipment. This has allowed
sustained profitable mining operations as DMG transitions into
immersion with next generation mining technologies. As the supply
of the newest generation Bitcoin mining equipment will be crucial
for DMG’s future growth, DMG is continuing to work closely with
leading miner manufacturers and component manufacturers of chips,
boards and tanks. DMG intends to announce further contractual
equipment and development details shortly.
The Christina Lake Data Center, an 85-megawatt
substation with a 27,000 square foot data center, resides in the
Company’s wholly-owned debt-free building on a 33 acre property.
DMG’s investment in this infrastructure allows the company to pivot
between self-mining and hosting for third parties. This flexibility
allows DMG to control capital costs when needed, and also take
advantage of the most profitable revenue streams as they change
over time between hosting and self-mining.
The Company expects the COVID-19 pandemic to
affect the availability and timing of mining equipment, including
increased costs from shipping. If additional mining equipment is
purchased for the Company’s Christina Lake Facility, the Company
expects longer than normal delivery times from the various
equipment manufacturers and suppliers. In addition, depending on
the number of additional Bitcoin mining rigs purchased by the
Company, additional capital may be required.
Reaching DMG’s Goal to be a Vertically
Integrated Blockchain Company - BlockseerIn early 2018,
DMG acquired Datient, Inc., the Silicon Valley-based creator of
Blockseer and Walletscore. The acquisition was a strategic move
based on the future of compliance and good governance in the
cryptocurrency space. Blockseer highlights DMG’s foresight in
ensuring the Company develops the right technology at the right
time, not only to participate but to have the products and
technology ready to unlock adoption through regulatory
compliance.
Blockseer - Software Focused on Safety
& Security & Regulatory & ComplianceOver the
last two years, the Blockseer team has focused on strategically
targeting the progression of the crypto industry and how Blockseer
can ensure its blockchain data will create industry needed
products. Recent changes, along with institutional interest moving
into Bitcoin, as discussed above, and the regulatory announcements
from the Office of the Comptroller of Currency (OCC) show that this
is both a rapidly developing and cutting-edge space. This message
has been echoed by nominated Secretary of the Treasury J. Yellen,
looking to prevent illicit transactions in the Bitcoin network.
Fortunately, Blockseer is well positioned to help pioneer this
industry with our first two products (Explorer and Walletscore)
which allow users to be properly informed, aware and protected in
an otherwise often grey space. Expanding on Explorer and
Walletscore, Blockseer launched its Pool platform which will be
integrated with Blockseer’s Mine Manager, as one unified
platform.
A review of Blockseer’s products are as
follows:
Blockseer: Safety & Security
PlatformBlockseer Explorer (sometimes referred to
as Intelligence) is an analytics tool that enables
tracking cryptocurrency on both the Bitcoin and Ethereum
blockchains.
Blockseer: Regulatory & Compliance
PlatformsBlockseer Walletscore measures the
propensity of a crypto-wallet to engage in criminal activity.
Blockseer Pool is the North
American-based Bitcoin mining pool, providing real-time AML and
bringing in a new standard in mining compliance and governance. In
late 2020, DMG announced that its U.S. subsidiary Blockseer was
launching a North American-based Bitcoin mining pool focused on
governance, compliance, clean blocks, and audit-ready reporting for
its users.
Blockseer Mine Manager is software which tracks
mining facilities’ performance. The software provides automated
management of crypto mining data centers and remote container
deployments.
“This is not about a fundamental change of the
network, nor a Bitcoin revolution, and we are absolutely not
de-anonymizing Bitcoin, but we need to be prepared for continuing
technological development and regulatory adjustment of the Bitcoin
network as it needs oversight to satisfy both major institutional
investors and official regulators,” said DMG’s COO, Sheldon
Bennett. “At DMG we are totally committed to continuously support
and enhance the global Bitcoin network, and at the same time we are
convinced that the future of Bitcoin’s rapidly increasing mass
adoption lies in regulatory compliance and market adoption as this
great cryptocurrency invention cannot and should not be abused by
criminals and terrorists or confined to the darkest corners of the
internet. Bitcoin is a growing asset class and in order for Bitcoin
to be adopted by large institutions and be accepted by regulators,
enhanced mining pools will be needed.”
DMG is excited that this new product caught the
attention of major North American miners, leading DMG to a new
partnership.
DCMNA - A New Partnership
Recently DMG entered into a memorandum of
understanding (“MOU”) with Marathon Patent Group
(NASDAQ: MARA) which then registered and created a 501c4 Non-Profit
named the Digital Currency Miners of North America (www.DCMNA.org).
The DCMNA intends to license Blockseer’s Bitcoin mining Pool
software, a proprietary product created by DMG’s U.S. subsidiary.
The organization’s principal initiative is to create North
America’s first cooperative Bitcoin mining pool so all its members
can take advantage of a cooperative network structure. Some key
highlights include:
- DCMNA’s Inaugural Chairman is
Merrick Okamoto, Executive Chairman of Marathon Patent Group Inc.
(NASDAQ: MARA), one of the world’s largest and leading Digital
Currency Mining companies.
- DCMNA will lobby for beneficial
changes and policies in North America for crypto mining. Financing
of these efforts will be through a small percentage of pool fees
allocated to its governing Committee.
- DCMNA enables its members to meet
Anti Money Laundering (AML) and Office of Foreign Assets Control
(OFAC) compliance through licensing Blockseer’s Pool which will
include Blockseer’s Walletscore technology.
- As the Pool is a cooperative it
will rebate all users based on hashrate contribution to help with
subsidizing pool fees and increasing miner profitability
- As a member service organization,
the DCMNA will continue to engage DMG’s Blockseer for continued
improvements to software, products, and creating more incentives
for DCMNA Members. Other member suggestions and products which
benefit North American miners will be reviewed for inclusion as
well.
DMG believes that the path to large scale global adoption for
digital assets is vastly improved through mainstream adoption, from
retail to institutional participants. This process has begun, and
it is imperative that all participants ensure they meet current
guidelines, regulations, and reporting criteria. Blockseer leads
DMG’s efforts to develop a vertically integrated blockchain company
where compliance is the key to bridging the transition of
cryptocurrencies to mainstream adoption.
See DMG’s news release dated January 5, 2021 for
further information on the planned DCMNA.
Terms of the MOU with Marathon include DMG
licensing Blockseer's technology and associated intellectual
property to DCMNA, as well as the management of pool operations.
Upon completion of a definitive agreement, detailed terms and
conditions will be provided in an upcoming news release. Pool
operations are expected to commence shortly after entering into a
definitive agreement.
“DMG, as a vertically integrated Blockchain
company, focuses on all aspects of the Bitcoin blockchain beginning
at the mining ecosystem, through to securing the blockchain and
processing Bitcoin transactions. Our business divisions include
self-mining, hosting third party clients, development and
deployment of software products such as Blockseer’s Mine Manager to
manage mining operations, as well as the recent launch of
Blockseer’s Pool, which aggregates Bitcoin mining hashrates and
connects them to the Bitcoin protocol,” said DMG’s CEO, Dan
Reitzik.
For more information on DMG Blockchain Solutions
visit: www.dmgblockchain.com
On behalf of the Board of Directors,Daniel Reitzik, CEO &
Director
For further information, please contact:
DMG Blockchain Solutions Inc.Email:
investors@dmgblockchain.com
Web: www.dmgblockchain.com
About DMG Blockchain Solutions
Inc.
DMG is a vertically-integrated blockchain and
cryptocurrency company that manages, operates, and develops
end-to-end digital solutions to monetize the blockchain ecosystem.
DMG’s businesses are segmented into three main divisions: data
centre operations, data analytics and forensics and developing
enterprise blockchains. DMG’s data centre operations focus on
earning revenues from block rewards and transaction fees by mining
primarily bitcoin, as well as providing hosting services for
industrial mining clients. DMG’s data analytics and forensic
services provide technical expertise software products such as
Blockseer Pool, Mine Manager and Walletscore, as well as working
with auditors, law firms, and law enforcement organizations. DMG’s
permissioned blockchain technology is focused on developing
enterprise software for the supply chain management of controlled
products. DMG’s strategy is to become the domain expert across the
business verticals it focuses on. DMG’s management team includes
seasoned crypto experts, forensic & financial professionals and
blockchain developers with deep relationships throughout the
industry.
Cautionary Note Regarding
Forward-Looking Information
This news release contains forward-looking
information based on current expectations. Statements about the
Company’s plans for the potential establishment of its strategic
long-term plans, its DCMNA pool and definitive agreement, to
increase petahash (PH) by self-mining, acquiring additional bitcoin
mining machines, raising additional capital, utilizing the whole
Christina Lake Facility, the potential of the immersion cooling
technology, the expected positive outlook for the cryptocurrency
and blockchain industries, price of bitcoin, plans and intentions,
software development plans, other potential transactions,
acquisition of customers, product development, events, courses of
action, and the potential of the Company’s technology and
operations, among others, are all forward-looking information.
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, 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 bitcoins; security threats,
including a loss/theft of DMG’s bitcoins; 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.
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 COVID-19 or other viruses and
diseases on the Company’s ability to operate, secure equipment, and
hire personnel, decrease in the price of Bitcoin and other
cryptocurrencies, competition, security threats including stolen
bitcoins from DMG or its customers, consumer sentiment towards
DMG’s products, services and blockchain technology generally,
failure to develop new and innovative products, litigation,
increase in operating costs, increase in equipment and labor costs,
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.
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.
MARA (NASDAQ:MARA)
Historical Stock Chart
From Aug 2024 to Sep 2024
MARA (NASDAQ:MARA)
Historical Stock Chart
From Sep 2023 to Sep 2024