Why HIVE Blockchain Technologies Ltd (OTCMKTS:HVBTF) Needs to be Back on the...

Why HIVE Blockchain Technologies Ltd (OTCMKTS:HVBTF) Needs to be Back on the Radar

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It’s been a long time since we had occasion to cover a crypto play because the space has been so thoroughly mired in a desperate bear market, but HIVE Blockchain Technologies Ltd (OTCMKTS:HVBTF) has jumped back onto our radar following a massive rebound in Bitcoin so far in 2019. Helping to add color to the story for this token miner is news that it has entered a non-binding letter of intent and heads of terms and a share swap agreement with Argo Blockchain PLC (LSE:ARB) to explore a proposed strategic partnership to create the world’s largest business-to-business mining service provider aimed at large-scale enterprise and institutional customers.

According to the release, “The proposed strategic partnership will enable all miners to benefit from the combination of the two groups’ existing mining capacity, including part of HIVE’s equivalent mining capacity of 45 megawatts and Argo’s 10.5MW capacity and presents a significant opportunity to service strategic institutional clients that require Mining-as-a-Service (MaaS) infrastructure to mine virgin coins from safe jurisdictions like North America and Europe.”

HIVE Blockchain Technologies Ltd (OTCMKTS:HVBTF) trumpets itself as a company that operates in the cryptocurrency mining space.

It engages in the mining and sale of digital currencies, such as Ethereum, Ethereum Classic, and ZCash.

The company was formerly known as Leeta Gold Corp. and changed its name to HIVE Blockchain Technologies Ltd. in September 2017. HIVE Blockchain Technologies Ltd. was incorporated in 1987 and is headquartered in Vancouver, Canada.

According to company materials, “HIVE Blockchain Technologies Ltd. is a growth oriented, TSX.V-listed company building a bridge from the blockchain sector to traditional capital markets. HIVE is strategically partnered with Genesis Mining Ltd. to build the next generation of blockchain infrastructure. HIVE owns state-of-the-art GPU-based digital currency mining facilities in Iceland and Sweden, which produce newly minted digital currencies like Ethereum continuously as well as cloud-based ASIC-based capacity which produces newly minted digital currencies like Bitcoin. Our deployments provide shareholders with exposure to the operating margins of digital currency mining as well as a growing portfolio of crypto-coins.”

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As noted above, HVBTF just announced that it has entered a non-binding letter of intent and heads of terms and a share swap agreement with Argo Blockchain PLC (LSE:ARB) to explore a proposed strategic partnership to create the world’s largest business-to-business mining service provider aimed at large-scale enterprise and institutional customers.

We’ve witnessed 29% tacked on to share pricing for the listing in the past month. What’s more, the stock has seen a growing influx of trading interest, with the stock’s recent average trading volume running 49% beyond what we have been seeing over the larger time frame.

“We are excited about this strategic partnership and our analysis indicates that Argo is significantly undervalued,” said Frank Holmes, Interim Executive Chairman and Interim CEO. “They have a healthy cash position with more than £16 million, as of December 31, 2018, and since then Argo has deployed some of the most efficient ASIC chips to expand Bitcoin operations while cryptocurrencies continue to rebound from lows seen at the beginning of 2019. In our view, the crypto market is ready for a mining solution focused on enterprise customers that require accountability and transparency. Our combination of scale, software and teams will be transformational in this growing market.”

Earning a current market cap value of $154.16M, HVBTF has a significant war chest ($22.9M) of cash on the books, which must be weighed relative to about $7.4M in total current liabilities. HVBTF is pulling in trailing 12-month revenues of $45.6M. In addition, the company is seeing major top-line growth, with y/y quarterly revenues growing at 168.1%. You can bet we will update this one again as new information comes into view. Sign-up for continuing coverage on shares of $HVBTF stock, as well as other hot stock picks, get our free newsletter today and get our next breakout pick!

Disclosure: we hold no position in $HVBTF, either long or short, and we have not been compensated for this article.

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