Bitcoin mining firm Bitfufu has inked an agreement with BITMAIN to purchase Bitcoin mining machines. According to the official announcement from January 2nd, BitFuFu has signed a two-year framework agreement with BITMAIN, a leading manufacturer of digital asset mining hardware, to buy up to 80,000 S-series miners.
The purchase comes at a time when Bitfufu has been expanding its operations amid the backdrop of growth in the crypto industry.
What Will The Agreement Include?
In accordance with the framework agreement, BitFuFu is free to place orders in two-year increments. Depending on the state of the market and BitFuFu’s changing needs for miner capacity, the machines will be available for BitFuFu’s self-mining operations as well as to offer mining services to clients, such as miner resales, cloud mining, and miner hosts.
Leo Lu, Chairman and CEO of BitFuFu commented on the partnership saying, “Our deep strategic partnership with BITMAIN ensures a steady supply of the latest miners to rapidly expand our mining infrastructure globally with a target of adding 1 GW in capacity by the end of 2026.”
They add “The new miners will be utilized to bolster both our self-mining operations and cloud-mining services, delivering highly cost-effective and energy-efficient solutions. With the flexibility to procure equipment in batches over the next two years based on operational demands, this agreement further reinforces our position as a leader in the industry.”
Payment Structure For the Agreement
The conditions of the agreement allow BitFuFu to pay a portion of the purchase price in BitFuFu shares at its discretion and to postpone a portion of cash payments interest-free following the miners’ delivery.
This financial adaptability supports the company’s expansion plan while guaranteeing effective capital and cash flow management.
BitFuFu’s Previous Expansion Plans
The Bitmain-affiliated cloud mining startup BitFuFu stated that it had acquired an 80-megawatt Bitcoin mining facility in Ethiopia.
Its cost-effective operational structure, with an average electricity cost of less than $0.04 per kilowatt-hour, makes the acquisition aligned with the expansion plans of the firm.
BitFuFu likely hopes to increase its operations with the acquisition of the facility, which will bring up the company’s overall hosting capacity above 600 megawatts, which is a significant increase from its current 522 MW capacity.
This transaction is particularly noteworthy since it represents a transition away from the company’s prior reliance on third-party hosting arrangements, with around 13% of its hosting capacity moving to self-owned and operated facilities.
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