Bitfarms Provides January 2022 Production and Mining Operations Update

Bitfarms Ltd. (NASDAQ: BITF // TSXV: BITF), a global Bitcoin self-mining company, provided a Bitcoin (BTC) production and mining operations update for January 2022. The commencement of operations in January at its 10-megawatt (MW) farm in Paraguay increased total farms in production from six to seven and total capacity to 116 MW.

“As we execute on our growth strategy of expanding into new geographies and leveraging our presence in these regions, Paraguay is of particular strategic importance,” said Emiliano Grodzki, CEO of Bitfarms. “Bringing our Paraguay farm online marks the start of our commercial operations in South America. The first of our two South American development projects, bringing the Paraguay farm online furthers our goals of achieving 3 exahash per second (EH/s) by the end of the first quarter of 2022 and 8 EH/s by the end of 2022.

“Furthermore, I’m pleased to report that January 2022 production of 301 BTC represents an increase of 51% from January 2021,” continued Grodzki. “This strong year-over-year increase validates our growth model.”

“As part of our economic and ESG strategies, Bitfarms utilizes excess electricity generation and has been for several years party to energy curtailment programs at some of our farms in Québec,” said Geoff Morphy, President and COO of Bitfarms. “As the province of Québec is powered almost entirely with renewable hydropower, during the period from December through March when Québec is affected by colder weather, the electricity that would otherwise be in excess of community requirements throughout the rest of the year is sometimes needed to heat and power local homes and businesses. As a result, during these extremely cold periods, Hydro-Québec and municipal utilities will occasionally invoke the energy curtailment programs. The energy curtailment programs are impacting production similar to prior winter periods as a normal part of our operations. January is typically the most affected month, with seasonality moderating throughout February and March and limiting the impact on our overall mining operations to the most severe winter months.”

Facilitated by these programs, Bitfarms helps to stabilize the power grid, provide reliable electricity service to all Québecois, reduce wasted electricity and increase profits for Hydro Québec and municipal utilities which are reinvested in the communities where Bitfarms operates. The success of these programs over the last several years resulted in their provincewide adoption in 2022.

Mining Production

2.3 EH/s achieved effective January 23, 2022, up 100 petahash per second from December 2021.

301 new BTC mined during January 2022, up 51% from January 2021.

9.5+ BTC mined daily on average in January, equivalent to about US$365,900 per day and approximately US$11.4 million for the month based on a BTC price of US$38,000 on January 31, 2022.

299 BTC from mining in January deposited into custody.

4,600 BTC in custody at January 31, 2022, inclusive of 1,000 BTC purchased during the month, representing a total value of approximately US$175 million based on a BTC price of US$38,000.

January 2022 Mining Operations

Increased operating capacity 9% from 106 MW to 116 MW of hydropower.

Initiated production at the Paraguay farm, increasing farms in production to seven.

Ended January with 288 MW in contracted capacity and three farms under development.

Continued progress in building The Bunker and Leger farms in Sherbrooke, with expected miner deliveries on track for deployment at The Bunker in the first quarter of 2022.

Received and installed approximately 1,840 new miners. The Chinese New Year, which runs from January 31, 2022 through February 15, 2022, is expected to slow miner production and deliveries; thus, most of the February deliveries are expected to occur in the latter half of the month.

Ended the month with 47,360 contractually secured miners for scheduled deliveries throughout 2022.