After the execution of a memorandum of understanding in early
January 2021, Marathon Digital Holdings Inc. (Nasdaq: MARA),
(“
Marathon”) and DMG Blockchain Solutions Inc.
(TSX-V: DMGI) (OTCQB-US: DMGGF) (FRANKFURT: 6AX)
(“
DMG”), a vertically integrated blockchain and
cryptocurrency technology company, have entered into a definitive
license agreement (the “
Agreement”) to provide
technology solutions for Marathon and the new Digital Currency
Miners of North America (“
DCMNA”) pool. Marathon
is one of the largest enterprise Bitcoin self-mining companies in
North America and will be launching the first North America-based
Bitcoin mining pool that is fully compliant with U.S. regulations,
including anti-money laundering (AML) and the Office of Foreign
Asset Control’s (OFAC’s) standards. Unique features of DMG’s
Blockseer pool technology include the ability to filter
transactions to ensure AML and OFAC compliance in anticipation of
impending US regulations. On a day-to-day basis, DCMNA will
manage the pool with DMG providing strategic guidance and/or
technical support as needed.
Marathon intends to direct 100% of its hashrate
to the new mining pool. Marathon expects all 103,120 of its miners
to be deployed by the first quarter of 2022, at which point, the
Company will be directing 10.37 EH/s to the mining pool. In June
2021, the pool will begin accepting other U.S.-based Bitcoin mining
companies.
Terms of Agreement with Marathon
As part of the Agreement, Marathon will be
licensing DMG's proprietary Blockseer pool technology to be used by
the DCMNA entity. Pursuant to the terms and conditions of the
Agreement, DMG will receive:
(a) |
|
USD$500,000 in common shares of Marathon; |
(b) |
|
a monthly license fee paid in cash or Bitcoin (at DMG’s
election) with a sliding scale based on DCMNA’s block rewards and
transaction fees received by the pool; and |
(c) |
|
technical support services to be provided on an as-needed basis
with payment in US dollars. |
"We are excited to provide our proprietary
software tools to the DCMNA pool.. As more U.S.-based Bitcoin
mining companies (and their hashrate) join DCMNA, DMG will receive
more Bitcoin from licensing our technology," said DMG’s CEO &
COO, Sheldon Bennett.
“While institutional interest in Bitcoin is
accelerating, many large funds and corporations have expressed
concerns over purchasing Bitcoin that may have been tainted by
nefarious actors,” said Merrick Okamoto, Marathon’s chairman and
CEO. “Our pools’ initiatives are grounded on decentralization,
transparency, legal compliance with U.S. rules and regulations, and
independent auditability under U.S. auditing standards. While we
appreciate some miners’ appetite for processing transactions
indiscriminately, it is our belief that as a publicly listed
company based in the United States, and as one focused on enabling
more institutional adoption of Bitcoin, it is our responsibility to
follow U.S. regulations. We believe that such regulatory compliant
mining will allow us to produce ‘clean’ Bitcoin, which will enable
a greater number of institutions to gain exposure to this new asset
class, ultimately benefiting our organization, our shareholders,
and the broader network.”
Okamoto continued, “Currently, more than
two-thirds of Bitcoin’s global hashrate is concentrated in pools
with little transparency, and most reside in one country. It is our
belief that this concentration of hashrate outside of the United
States, where central authorities could interfere with mining
operations without due process, poses a risk to the network. We
believe shifting more mining power to the U.S. could reduce these
risks, potentially strengthening the network and benefitting all
who participate in it. If all 10.37 EH/s of our potential hashrate
were pointed towards this pool today, our mining pool would be the
seventh largest bitcoin mining pool in the world, putting North
America on the map as a digital-asset mining hub.”
Management/Director Updates
DMG also announces a change in senior management
and the addition of a new director.
The Company reports that Daniel Reitzik has
resigned from DMG as a director and as the Chief Executive Officer.
Mr. Reitzik was one of the founders of DMG, and helped DMG grow
from a small company in 2016 to a leading cryptocurrency and
blockchain company. The Company thanks Mr. Reitzik for his
contribution to DMG and wishes him all the best in his future
endeavors.
Sheldon Bennett, also a founder, who leads the
day-to-day operations of DMG, has been appointed CEO and will also
continue in his position of Chief Operating Officer for the time
being. With the appointment to CEO, Mr. Bennett will continue
building on his role of developing new business opportunities,
partnerships, and continuing to execute on bringing DMG’s products
to market.
The Company is also pleased to announce that
Steven Eliscu has joined DMG’s board of directors. In adding Mr.
Eliscu, DMG gains a board member who will help oversee the
Company’s continued transformation, while guiding it to focus on
key long-term drivers of valuation. Mr. Eliscu currently works as
Head of Finance for DSP Concepts, and he is an experienced
Blockchain and technology industry veteran, with experience at
Bitfury as well as having advised a number of Blockchain start-ups.
Mr. Eliscu is also a former equity research analyst for UBS, having
provided investment coverage of the semiconductor industry to
institutional investors. Mr. Eliscu has a Bachelor of Science in
Computer Engineering from Rensselaer Polytechnic Institute and an
MBA from the University of Chicago Booth School of Business. Mr.
Eliscu’s experience makes him ideal to chair the Board’s Audit
Committee.
The Company also announces that it has granted
200,000 stock options with an exercise price of $2.49 to Mr. Eliscu
for a three-year term.
Terra Clean Energy Pool
As previously disclosed on March 26, 2021, DMG
and Argo Blockchain Plc will provide further updates on the Terra
Pool as developments and progress occurs.
About Marathon Digital Holdings
Inc. Marathon is a digital asset technology company that
mines cryptocurrencies, with a focus on the blockchain ecosystem
and the generation of digital assets.
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 entirely powered by renewable energy.
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 experts across the business verticals it
focuses on. DMG’s environmentally committed management team
includes seasoned crypto experts, forensic & financial
professionals and blockchain developers with deep relationships
throughout the industry.
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
operational results could also be materially affected by the price
of Bitcoin and an increase in hashrate mining difficulty.
For more information on DMG Blockchain Solutions
visit: www.dmgblockchain.com
On behalf of the Board of Directors,Sheldon Bennett, CEO, COO
& Director
For further information, please contact:
DMG Blockchain Solutions Inc.Email:
investors@dmgblockchain.com
Web: www.dmgblockchain.com
For Media Inquiries:Jules
Abraham, Head of Public RelationsCORE IR
917-885-7378julesa@coreir.com
Investor Relations
Contact:CORE IR 516-222-2560
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 InformationThis news release contains
forward-looking information based on current expectations.
Statements about the DCMNA and its expected outcomes, plans and
benefits, other Bitcoin mining companies joining the DCMNA Pool,
Marathon’s expected hashrate, updates and progress on the Terra
Pool, price of bitcoin, plans and intentions, 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, competition, security threats including stolen
bitcoins from DMG or its customers or from the DCMNA, consumer
sentiment towards DMG’s products, services and blockchain
technology generally, decrease in the price of Bitcoin and other
cryptocurrencies, failure of other Bitcoin mining companies to join
the DCMNA, 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.
Marathon Digital (NASDAQ:MARA)
Historical Stock Chart
From Mar 2024 to Apr 2024
Marathon Digital (NASDAQ:MARA)
Historical Stock Chart
From Apr 2023 to Apr 2024