Ben Gagnon Interview / CEO of $bitf

Hosted by @₿itcoin ₿utcher 🥩 🐑 🐷 · 2025-09-15 · Tags: BITF, KEEL

TLDR

BitFarms CEO Ben Gagnon outlined the company’s shift from internationally focused Bitcoin mining toward North American energy infrastructure for AI and high-performance computing. He emphasized Pennsylvania’s power pipeline, partnerships such as T5, site-specific financing, and a strategy of owning durable infrastructure rather than rapidly depreciating GPUs, while acknowledging execution, regulatory, and capital requirements.

BitFarms is prioritizing the United States and AI/HPC infrastructure while reducing its focus on Latin America.
The Stronghold acquisition was underwritten around converting Pennsylvania energy assets into AI/HPC capacity rather than merely operating power plants.
Management says Sharon, Washington and Panther Creek offer the fastest routes to initial HPC revenue, potentially beginning in late 2026 or early 2027.
Scrubgrass is still at the conceptual-study stage but could eventually become a campus exceeding one gigawatt.
HPC electricity contracts are expected to use firm service at market prices, with energy-price risk passed through to customers.
BitFarms expanded its leadership, board and advisory bench and is relying on experienced partners such as T5 for data-center development and operations.
Smaller sites may serve enterprise customers at higher margins, while large campuses are intended for hyperscalers and neocloud providers.
The company prefers owning power and data-center infrastructure instead of GPUs, which depreciate quickly and require recurring capital spending.
A $300 million Macquarie facility is designed to finance Panther Creek’s first 50-megawatt phase, while later phases and other sites will require separate financing.
Gagnon defended the share-buyback program as an opportunistic use of capital when BitFarms shares were substantially undervalued.

Speakers

₿itcoin ₿utcher — Hosted the discussion and asked how BitFarms would finance its capital-intensive data-center projects and justify its share-buyback program.
Elkama — Led most of the interview, framed BitFarms as an AI-megawatt investment opportunity, and questioned Gagnon about the pivot, sites, personnel, customers, environmental issues and geographic opportunities.
mid-level cruiser — Asked technical questions about PJM power structures, pricing and demand-response arrangements, then praised Gagnon and said he was buying shares after the interview.
Ben Gagnon — Explained his mining background and BitFarms’ strategy to monetize North American energy assets through AI/HPC infrastructure, including site development, partnerships, customer segmentation, financing and capital allocation.

Notable quotes

“Yeah, I think I'm clearly a Bitcoin maxi at heart, but the other thing, I'm also a profit maxi.” — Ben Gagnon
“And at BitFarms, we were underwriting the transaction as the ability to convert them off into HPC and AI.” — Ben Gagnon
“And our focus right now is execution, execution, execution.” — Ben Gagnon
“And what we bring to the table is an answer to the problem that everyone faces, which is where are they going to plug in these GPUs?” — Ben Gagnon
“This is the area that we think is going to be, you know, measured over a gigawatt as opposed to into the megawatts.” — Ben Gagnon
“So BitFarms is not taking any sort of risk on the price of the energy.” — Ben Gagnon
“I don't want to own the depreciation of the compute.” — Ben Gagnon
“We still believe that our shares are undervalued.” — Ben Gagnon
“I'm buying shares right now after hours.” — mid-level cruiser

Transcript

₿itcoin ₿utcher: Hey, everyone. We're going to wait for a few people to get on, but can you give me a thumbs up if you can hear me?

Elkama: Everybody, how's my sound quality? I don't want to get another ticket by Mike Alfred about how bad my mic is. Can somebody give you a thumbs up?

₿itcoin ₿utcher: I can hear you, Elkama. Can you confirm that my mic's working well?

Elkama: It was a little choppy for a second, so I don't know if it's my side or your side, but I hope my side is okay.

₿itcoin ₿utcher: Yeah, yours is good.

Elkama: Okay, perfect. So we're just waiting for the guest of honor here, Ben Gagnon. And we've had another spectacular day here at BitFarms. There was a little bit of a dump in the early trading, right? It was down 5%. I was trying to buy some calls, but a penny pinched and didn't get it what I wanted. I should have just slapped that ask because those options are printing now. We finished at 289, which is crazy because it was down 5%. And it finished up above 15%. That's like a 20% interday swing. And it was pretty funny that it sort of coincided when Ben Gagnon, he tweeted about the space. So I don't know if we have that much influence or is it just him, but it was crazy, right? As soon as he tweeted, you can see that V-shaped recovery turning negative 5% now into the end of the day at over 15%. Hey, mid-level cruiser. I mean, mid-level cruiser, do you have anything to say while we wait for Ben?

mid-level cruiser: Hey, what's going on, everyone? Nothing major to add. I agree. As soon as I saw the GM tweet from Ben Gagnaw, I just started smash buying.

Elkama: Yeah.

mid-level cruiser: That's kind of my mid-level... operation yeah but it played out and um yeah it's exciting time and uh.

Elkama: We joked about it we said you know has anybody ever said good morning to you right?

mid-level cruiser: A good morning goes a long way it does uh and a little a little GM from a CEO goes a very long way okay but.

Elkama: Uh yep Ben's here so uh okay let's get started because he's only No, he's given us an hour of his valuable time. So we have a lot of questions. We have a lot of stuff to unpack. So I'll get right into it. Before I start, I do want to tell a bit of a story because Ben and I do have a bit of shared history. So this conversation is probably four to five years in the making. I was a very early investor in BitFarms. And around 2021, there was a conference that Ben attended. At the time, he was the only non-CEO on the stage, and he just blew everybody away with his competence and his confidence and how well he presented himself, right? Right there and then, I said, This is the person that is gonna be eventually the CEO of BitFarms if he decides to stay at BitFarms because he's so talented, he might get poached somewhere else. But if he stays at BitFarms, he is going to be eventually the CEO, right? So, you know, fast forward to last year, and Ben became the CEO. And at that time, you know, there was a mining mafia space that he got invited to, to talk about his new job, and they invited me up there. So that's the first time we interacted. And we did have the pleasure of meeting each other in Vegas, and we had a very short, sit down and to talk about BitFarms and their strategy. Now we get to finally speak on a space in front of everybody and to talk about BitFarms. And it comes right at the perfect time, right? Ben was at the HCW conference on September 9th, I believe, and he just nailed that presentation, right? The next day he went out and he purchased shares with his own money. and to show everybody that he's putting his money where his mouth is. And ever since, BitFarms has been on a tear. It closed at $2.89 today. So it's more than doubled from the time that Ben bought those shares and showed everybody that he means business. He's not joking around. So having said that, Why don't we have Ben introduce himself, right? Talk more about his background, because everybody thinks he's like 12 years old and asking for his McLovin driver's license, right? So maybe Ben could clarify, if he doesn't mind how old he is, his background, because a lot of people think that Ben might be Canadian, but I don't think he's Canadian, right? And it's interesting that Gagnon is actually a derivative, if I'm not mistaken, that it means farmer in French. Okay, Ben, you.

Ben Gagnon: Want to go? That's quite the intro comma. I really appreciate that. And good afternoon, everyone. A little bit of farmer hospitality there with my good morning and good afternoons. Yeah, you know, I realize I look young. I'm 36. I was raised gluten-free, and that's what really kind of results in this very, very young face. you know something that I'm still carded today and was was a little frustrating I think when I was you know 26 and 28 but at this point I just laughed and you know enjoy enjoy my beer so yeah you know this has been a long time in the industry for me I've been in Bitcoin well over a decade now it's been my full-time profession it's been my full-time job you know famously I miss out on a chance to buy Bitcoin in college, and I bought beer instead. And when you miss out on an opportunity to buy Bitcoin at 73 cents and you see it go up to $1,000 in 12 months, it really makes you question all of your life decisions. When I got into the space full-time in 2015, it was a very, very different environment. The space was a lot less mature, but I started building out Bitcoin and Ethereum mines in Hong Kong and Taiwan and mainland China. I did that for several years. And then I left out of my business in mainland China, kind of at the peak of the 2017 bull market, started a new business where I was developing two-phase immersion cooling for Bitcoin miners. I was one of the first immersion cooling manufacturers for Bitcoin. I provided the first full turnkey 100% equipment financing for Bitcoin miners. So I've been around the space for a very, very long time. And I joined BitFarms in 2019, right at the beginning of COVID. Was really excited about this company who was trying to do things in a much more professional way. They had a great reputation, a great set of operations, and I was able to come in at the right time, leverage several years of experience building and operating facilities, and really help BitFarms take it to the next level. So it's been six years with the company. You know, it's been my ambition since I took over as Chief Mining Officer in 2021 to take over as CEO of the company. So was thrilled to finally get the nod, you know, last year. And it's been a wild ride for the first 15 months or so as CEO. But I think we're in a very, very good spot now. I think we've really redirected the ship. We've made a lot of very, very challenging decisions, but we are in a really, really strong spot now. I'm really proud of the team and everything that we've been able to accomplish over the last 15 months.

Elkama: Well, that's great to hear. Okay, so I've talked over with the guys, right? The way we're gonna conduct this, you know, the space is I'll do most of the driving with you. We've broke it down into segments. So after each segment, you know, the other guys, if they have any other questions, they'll expand further onto those points or, you know, introduce something slightly different, like, you know, an offshoot of the same topic, but, you know, I've broke it down into, know, different segments, right? The pivot, opportunities for AI HPC, and then strategic direction, and then economics and governance. Well, obviously, we're gonna have to start with the, before we actually even start, I just want to make it clear that, you know, most of our discussion is going to be around AI HPC because at this point I don't think too many people get that excited about Bitcoin mining we love Bitcoin mining like most of us are Bitcoin fans and we've got into the space because of Bitcoin but in terms of stock price and company direction right I think there's no question at this point everything's being driven by AI HPC but more more specifically the power and infrastructure that's needed to run AI HPC, right? And we've all lucked out on the, you know, I call it the AI megawatts arbitrage trade, right? We wanted to buy Bitcoin miners because what we saw in the last cycle, how it ran like crazy, right? That trade is gone, but in the displace, no, we're dropped right into our laps, the AI megawatts arbitrage trade. So you know we're not going to focus too much on Bitcoin mining some of the questions might be related to the capital allocation but in terms of the actual operations and the operations and the forward guidance of Bitcoin mining I think we're largely going to skip because I don't think we have enough time to cover all of it right and we've already got an hour or so okay without further ado so let's talk about the pivot right I called the pivot back in August of 2024, right after you guys acquired Stronghold, right? I've looked at the whole situation. I saw how the Stronghold was actually consulting Applebee, right? There's a company called Applebee Consulting, and they were looking at the viability of the sites of Sawgrass and Panther Creek. And I postulated, no, you guys must have been involved in that process. And that would have been contingent upon finishing the deal. So do you want to start us off and tell us about the pivot and what kind of signals that BitFarms, what are the signals that really drove BitFarms into that direction?

Ben Gagnon: Yeah, I think I'm clearly a Bitcoin maxi at heart, but the other thing, I'm also a profit maxi. And sometimes there are better opportunities in the space. When you look at what we have, which is a fantastic portfolio of energy assets, which we developed over many years, we developed those under a very specific investment thesis, which is, where are the areas where the energy supply far exceeds the demand for energy, the distribution and transmission to carry it to other markets? And what are the areas where the energy is going to have applications beyond Bitcoin mining itself? And so when you look at the areas that we've really focused on in North America, Quebec, Washington, and Pennsylvania, these are areas where the energy supply far exceeds the energy demand. And these are areas that, in the case of Quebec and Washington, are already existing data center hotspots. And in the area of Pennsylvania is the new emerging data center hotspot. So when it came to working through the CEO process for last year, you know, my big focus was redirecting this company to North America and redirecting our energy assets to higher value opportunities. And that meant, you know, not only converting over assets that we had in some instances, like the Huazu sale that we did to Hive, it was focusing on North America and less focus on LatAm. And we really wanted to say, we've got a limited pool of capital. We don't have infinite amounts of money. So we're going to be the best value opportunities for us to deploy capital now. And we've been looking at the Pennsylvania sites with Scrubgrass since 2021. I mean, I first flew out there after Bitcoin Miami in 2021, before Stronghold was even public. And before they were even public, I was interested to buy this company. And what I saw there at the time in 2021 was not just power plants, but the ability to expand beyond the power plants with the strategic location of where they are in terms of additional energy grid capacity and their strategic proximity to natural gas, to major metropolitan areas. And that really piqued my interest quite early on. We've been trying to buy these sites for many, many years. And the reality is, is that back in 2021, when Stronghold was going to an IPO, they were valued higher than we were. And that sort of transaction didn't really make sense. But we stayed in touch with the company. We went out there multiple times. I got to know the founders, Bill Spencer and Greg Beard, very, very well. And it was always something that we saw the opportunity on. In 2023, when everyone was really focused on Texas and energy trading, we saw the same opportunity in PJM. And we saw the ability to basically get two megawatts for the price of one. And what nobody really realized was that with the power plants there and the ability to draw down a similar amount of capacity that we could sell into the grid, We could get two megawatts for the price of one megawatt. And that provided very, very strategic applications rolling forward. And then in 2024, this HPC and AI demand really took off. And we said, well, wait a minute. Actually, the opportunity here is no longer around this energy trading. It's around the ability to get even more megawatts off the grid capacity and convert them off into HPC and AI. This is an area where, you know, everyone else was underwriting the stronghold transaction on them being power plants. And at BitFarms, we were underwriting the transaction as the ability to convert them off into HPC and AI. And so I think a lot of people misunderstood the transaction when we first announced it. But the reality is, is that transactions worked out really, really well for BitFarms and our shareholders. You know, the power plants are worth quite a bit more than what we paid for them just a few months ago. And they really are the crown jewels in Bidfarm's portfolio rolling forward. So this is something that we've been looking at, you know, quite intensively throughout most of 2024. And before I took over as CEO, You know, the board gave me, you know, two mandates and there were mandates that that I agreed with wholeheartedly, which was focus on the United States and focus on HPC and AI. And that is exactly what we've done over the last 15 months. You know, we've we've scaled back Latin America. We've we've really focused on growing out the US pipeline. We've set up the second, you know, office in the United States. We've begun the process to convert over to US GAAP. So You know, you look at what we've been able to accomplish over the last 15 months. You look at what we're going to accomplish over the next 15 months. I mean, it's it's night and day. We're a completely different company than we were when I took over.

Elkama: Yeah. It's funny that you mentioned that other people were not valuing the sites beyond Bitcoin mining. But I'm not a professional analyst. But at the time, you know, when I wrote this, it's still on my timeline, you know, I compared the acquisition to Talon because it was in the same, the same, it was in the same state. It was very close by. And I looked at how much Talon paid for the, I mean, how much AWS paid for the Talon site, right? And I said, if you look at future dollars per megawatt, BitFarms is getting a deal. It might seem like a premium now, but if you're going to look down the line, it's going to look like a very good deal. And now time has proven that thesis to be correct, right? The question I do want to ask you is, the pivot, did you start this pivot before you were CEO? Because you mentioned that the board gave you the mandate, I think, prior to you being CEO, but was this there before, like how far did it go back? You know, the board mandating the move towards North America and focusing the geography to like the North American jurisdiction.

Ben Gagnon: It really started with the CEO search and the CEO transition. Previously, management was really focused on developing out Latin America. And there's several reasons for that. We had two co-founders who are from Argentina and had a big experience with Argentina. There was a value opportunity in Argentina. But when you look at What is the big bottleneck on this industry? It's always been energy. You know, outside of 2021 and the supply chain or the silicon shortage, energy has always been the bottleneck on growth. And I think it always will be the bottleneck on growth. And when you're looking at what are going to be the best areas to invest in, you know, do you want to invest in areas where there's just so much robust energy supply and good rule of law? Or do we want to invest in areas in Latin America where really the only opportunity is this Bitcoin mining opportunity? And for us, it was, you know, look, we've done really well in being the international Bitcoin miner. and growing our business. But is that the company that, you know, we really want to be in the next two years, three years, four years, five years from now? And I think clearly the answer was was no. So the transition started towards North America with the CEO search. You know, frankly, when I took over, the first priority was was getting the house in order. And, you know, we did that. We stabilized the business. We organized, reorganized the company and our management teams. We solved the Bitcoin miner issues that we had with Bitmain. We defended against a hostile takeover. We acquired the best assets that we identified in the United States. We sold off the assets in Latin America that we didn't have the capital to do both Pennsylvania and Latin America, so we were able to focus our efforts down. And we were really, really able, I think, to right the ship. So it started right around the CEO transition, but first priority was get our house in order. Like, you know, you don't want to build a completely new business on top of a foundation that had some, you know, some holes in it. And so our first focus was fix the foundation, then build the house, and we fixed the foundation, Now we're aggressively in build mode. You know, we're not looking to grow the pipeline for some time. We've got over a gigawatt of megawatts to develop in PA for HPC and AI. They've all been validated as high priority strategic locations, high demand. And our focus right now is execution, execution, execution. If it's not helping us build out those sites, if it's not helping us get closer to generating HPC revenues, We're not doing it.

Elkama: Yeah, you touched upon the cleaning house, right? The board members, they're all gone. If you look at the board now, it's completely different, the personnel. So that leads into my next question, right? Going from a Bitcoin miner to a AI data center builder, right? The skill sets would be very different. I see Alex Bramner and there's other people there, but would you like to walk us through the gaps in terms of talent that you guys were lacking when you started? And you can name some of the people that you've added and their experience and how that can help BitFarms.

Ben Gagnon: Yeah, there's a lot of parallels between Bitcoin mining and HPC and AI, but HPC and AI is an infinitely more complex business. It's infinitely more expensive in terms of the infrastructure build out. The requirements are completely different level than what Bitcoin mining is. And we needed to build out a stronger batch. You know, hiring Alex was was really about replacing me on the operations and the strategy side, and I really don't think we could have found a better person to fill that role. He's been a tremendous value add to the company and has really, really been a key part of getting our house in order. But we also needed to hire other people. Like we've hired a new COO. We hired new head of data center operations. We hired a new general counsel. We got four new board members, including a new board member who's a former AWS senior executive. We really needed to bring in the right people on our bench. And we also needed to bring in the right strategic advisors. You know, the reality is, is it takes time to build a bench. And it's expensive to build a bench if you want to bring in every single person under the sun that you might need. And so we tapped into the resources that we deemed was necessary to get us up to speed and to get us rolling as fast as possible. And in some cases, that meant hiring people internally. In some cases, that meant working with external advisors and supporters to do this. And, you know, we've done that. I mean, we've partnered with great groups, whether it's ASG, who you mentioned earlier on the call, WWT or T5, who's helping us build out the data centers in Pennsylvania. These are all really, really great counterparties in the space that gave us a lot of leverage and a lot of ammunition to execute on this HPC and AI development pathway. And it helped shave a significant amount of time off our ability to build out this completely different business. So we're in a really, really good spot right now in terms of the people that we have, the strategic advisors that are in place. We have really quickly become subject matter experts in, you know, the various functions that we're all looking at. And, you know, the reality is, is that our core competency over the last eight years that we've developed as a business is really around developing energy infrastructure. And when you look at what is the biggest value creation opportunity right now, it's on energy. I can't build or operate a data center for Google better than Google can build or operate a data center for Google. And what we bring to the table is an answer to the problem that everyone faces, which is where are they going to plug in these GPUs? you know, for every dollar that we spend in infrastructure, the end customer is going to spend $3 in compute. And just like Bitcoin miners, if you've already allocated, you know, I don't care what the number is, 500 million, 50 million, 5 billion, Zuckerberg, 600 billion, you know, into compute, every day that you don't have those deployed, that's a day of revenue you don't get back. You'll never get it back. And, you know, NVIDIA is shipping new units every day. So is AMD, so is Intel. They're making new units every 12 months. That doesn't increase the value of the units they've already shipped, it degrades the value of those units. And so there becomes a really, really strong incentive for anyone who's already sunk, you know, hundreds of millions or billions of dollars into compute to deploy that compute as fast as possible. And the closer you get to deploying that or to receiving that compute and you can't deploy it, you know, the more desperate you're going to become, the more you're going to be willing to pay, and the higher margins that you're going to be able to lock in as a company like BitFarms. So, you know, that's the way that we're approaching it. You know, we're applying the lessons that we've learned as a Bitcoin miner over the years. in the new business model for HPC and AI. And we haven't stretched ourselves beyond our skis. We really took a long, hard look at ourselves and what is their core competency and what is the value that we can create? What's the problem that we're trying to solve? And it's the energy. In the power plants, when you go and you talk with the power plant operators, they'll tell you one thing, which really resonates with me. And they just say, it's the fuel, stupid. It's always about the fuel. If you've got good fuel, you know, you'll have good operations. And the same thing is true with data center operations. If you have good energy, you're going to have a good opportunity to create value here and build out a good data center operation. And, you know, you really can't do anything without that. So that's really the area that we're focused on. And I think we've got a fantastic team in place right now who is you know, working incredibly hard to pull off this execution. You know, it's not just me here. It's we've got over 300 employees who are working on this execution across all of our different sites and really could not be prouder of the team that we've assembled and everything we've accomplished.

Elkama: Okay, before I let mid-level Cruiser, you know, ask this question, I just wanted to make a comment about, you know, you saying that, every day that they can't plug in their compute. Hyperscalers or enterprise, whoever's bought those GPUs, they're losing money, right? So I think that's a theme lost on a lot of people because they're always asking when deal, when deal? As if you guys were the people who are the beggars. I think reality is it's the other way around. They are begging you. You're holding your cards and saying, well, wait, if you want us, come and pay us, right? Okay, mid-level, did you want to ask a question?

mid-level cruiser: Yeah, well, first of all, Ben, thanks a lot for coming up. Really appreciate it. And then on the topic of fuel, couldn't agree more. And it's interesting, looking at the latest deck that you guys had, you said you had a gigawatt in your pipeline in Pennsylvania. I don't really know a lot about the PJM market, and I'm curious if you could unpack how those contracts are structured. Like, are they fixed price PPAs? Are they block purchases? Is it a real time, a spot market? And then are you participating? Is it demand response programs? Do you have curtailment? I guess anything you could share about that market? 'Cause it seems like, I mean, that's a huge amount of power in a very up and coming state. So I was hoping you could unpack that a little bit more for us.

Ben Gagnon: Yeah, happy to, because that's the big, multi-billion dollar question here is around the energy and PA. You know, we've got a couple of different buckets of power. So we've got power plants, which, you know, obviously generate power that we can use to provide power to our data center operations where we can sell into the grid. That's one bucket. We've got another bucket of power where we can draw down from the grid a similar amount of power that we could sell into the grid. Right now, that's not firm capacity because it's tied up in the Talend transaction with FERC. And so until FERC resolves that issue with Talend, we're not including that really in our forecast. And then what we have are, there's kind of three stages when it comes to power applications and interconnections with PJM. You first have what's called a CLS. or a conceptual load study. This is the first kind of high level study where the grid is looking at what is the available energy generation, what is the available kind of forecasted demand, and what would this new application look like in terms of, you know, providing an instability to the grid. And really what they're looking for is stability to the grid. So they don't want to provide any sort of commitment to provide power that could create that instability. And once you have that conceptual load study in hand, you move on to what's called a DLS. And a DLS is really taking that into a much, much deeper level of study. And so you're looking at, hey, look, you've already confirmed what you want to do. with the power. Now we're going to look through the detailed load study, you know, much more in depth about how the power grid is going to interact and whether or not, you know, this thing is actually going to work. From there, you go on to ESAs. And once you have an ESA, you have a contractual commitment from the utility to provide a certain amount of power capacity by a certain date. And so when you look across our three sites in PA, We have Sharon, which has 30 megawatts active Bitcoin mining load and a firm ESA for 80 megawatts in the back half of 2026 for a total of 110. We've got our Panther Creek site, which has, you know, the power generation and the ability to draw down power, but it has ESAs in hand for 50 megawatts for the back half of 2026 and 300 additional megawatts really for the first few days of January 2028. But we've been told over and over again, you build it earlier, we're supplying it in the back half of 2027. And then you have scrubgrass. Now, we spend a lot of time talking about Panther Creek and Washington and Sharon because those are the three assets in our portfolio. that have the best potential to be generating HPC revenues in Q4 of 2026 or the first half of 2027. What we don't spend a whole lot of time talking about is scrubgrass. And the reason for that is because scrubgrass is a little bit further behind in those studies. It's gone through the CLS stage quite a few different times, and we've continued to refine those because what we found is that there is an abundant amount of energy there. And when you look at how this energy demand has really shaped out over the last roughly 18 months or so, we've gone from everyone wants a 100 megawatt site to everyone wants a 500 megawatt site to everyone wants a gigawatt site. And we are really focused on how do you optimize around timeline to HPC revenues for, you know, Panther Creek, Sharon, and Washington. But on the back side, when we're looking at how do you grow beyond that, we're really focused on developing out the energy story at Scrubgrass. So we've got that really big power campus. This is the area that we think is going to be, you know, measured over a gigawatt as opposed to into the megawatts. We don't have the visibility on that. We're in conceptual load study stage, so it's anything but firm, but we have got very high confidence that, you know, in the next three to four years, Panther Creek, or sorry, Scrub Grass is going to be the largest site in our portfolio by a country mile. And so, you know, we're trying to optimize across those two variables, which is fastest pathway to HPC revenues? And then on the back end, how do we get the largest possible site to match up with what we think the growth is going to be and what the demand is gonna be like over the coming three to four years?

Elkama: Yeah, I've looked at your portfolio pretty extensively, right? Before I thought it was a toss up between Panther Creek and Scrubgrass, but now I think this is the first time I've heard it that Scrubgrass could potentially become a gigawatt site, is that correct?

Ben Gagnon: Yeah, that's correct. It's going to take years and we don't have firm certainty on that. So we don't talk about it, very extensively. But it's what we're working on as a pipeline for three to four years. And I realize I missed out a portion of mid-levels question in terms of the pricing. we have energy demand response programs on the Bitcoin mining, but that's not what we have for the HPC load. The HPC load is firm service, which means no energy demand and response. You know, the way that it's structured is you buy power at market rates and you pass it through to the customer. So BitFarms is not taking any sort of risk on the price of the energy. it's really dependent on the customer to take that risk. Then it would be up to the customer to decide whether or not they want to use, you know, the huge variety of financial tools available in the PGM market to lock in a price or hedge out risk. It's really going to be customer specific, but the contracts we have are firm service at market price.

Elkama: Okay, so this one. That's great.

mid-level cruiser: Yeah, sorry. Just real quick, Kama, and then What are you looking at in terms of like average costs on a megawatt hour in that market? Because mostly it's coal, nuclear and gas, right?

Ben Gagnon: Yeah, gas is the big one. Nuclear coal has been getting smaller and smaller every single year. There's a bit of renewable too, but Pennsylvania is gas country. There is an absurd amount of natural gas in the state and there is a huge imbalance between that gas supply and distribution and transmission capacity. So that's where you look at where all the new energy generation is coming from. It's almost exclusively net gas. There is some, you know, nuclear, there is some some wind and there's some solar. There's a very small amount of hydro, but it's mostly net gas. Awesome.

Elkama: Yeah. On the topic of fuel, there's a person named Stephen designer. Right. I think he was a stronghold. You know, he was a longtime stronghold shareholder and he has some concerns about the fuel currently used at the generation plants as scrubgrass and Panther Creek and more specifically Panther Creek because, you know, it's refuge. Right. And if potential customers, you know, hyperscalers or enterprise, if they're looking at that site, are they going to have any problems with the the fuel being refused coal, are they aware of it?

Ben Gagnon: So it's actually something that we did in advance of announcing Stronghold is we went out and we spoke with potential hyperscaler customers and validated this, whether or not there would be demand and whether or not this would be of interest. And what we found is that there are a few people who are not interested, but for the most part, no, the priority is around timeline to energization. And the second part of that that question is, you know, we currently are just focused on the grid connection. We're not actually focused on providing the power from the power plant into the data center operation because it's still tied up in that FERC regulatory matter that I that I mentioned earlier. So, you know, all the development that we're doing right now, that's firm service from the grid. But that is something that we validated in advance of announcing the stronghold transaction. And it goes both ways. It really depends on the counterparty. The reality of the situation is that we're burning waste. These are waste incineration plants. And they're well recognized by the state for the huge environmental benefits that they're bringing. If you go on Google Maps, and I recommend you do, and you go on to kind of the satellite imagery and you scroll around at the state, what you'll see is just massive, massive amounts of coal piles everywhere you go around the state. There's just thousands and thousands of these things. And the reality is, is that when the Industrial Revolution took off in the early 1800s, they were bringing up high BTU coal and they were bringing up low BTU coal. And high BTU coal is like 14,000 BTUs a pound. And when it's like low BTU coal, it could be anywhere from like, 3,000, 8,000 BTUs, and they didn't have enough energy content to actually drive the turbines and the older technology. And it wasn't until the 1980s that that really became something that was solvable. And so for 200 years, every time they dug up high-energy coal, they also dug up low-energy coal, and they piled it up in mountains. And so all around the state, there are thousands of these piles and they could be, you know, hundreds of meters or miles wide and they could be hundreds of meters tall. And, you know, this is something that has caused a huge, huge environmental issue for the state for very, very long time. If you leave it sitting there, the reality is it will get struck by lightning and it will spontaneously combust at one point, and before it does that, It gets rain from moisture and snow. The water percolates through the coal. It extracts really toxic materials like mercury and arsenic and all these terrible things. It leaches into the water supply. It goes into the Appalachian River. It goes into the, to the Missouri. It feeds into all of the different agricultural systems who are feeding their crops off that water. It ties into the Gulf of America and it goes into, you know, all of the fishing supply. This is a really, really big environmental problem. And so because of that, the state has a lot of programs to encourage this kind of development. There's only about 12 of these power plants in the state. They have all just recently had their energy tax credits doubled and extended out through 2036. And this was done by Democratic Governor Shapiro. So this is something that has bipartisan support across the state. It's classified in the same category as large-scale hydropower, because this is really something that is cleaning up communities and solving an industrial toxic problem that has existed for 200 years that nobody else has figured out a solution for. So, you know, it's a great opportunity here for a lot of data center companies to, you know, supply power and also solve an environmental problem.

Elkama: Well, yeah, that's good to hear that, you know, there's no concerns about the environmental issues or potential environmental issues of using fuel at your sites. Okay, now let's move into some of the opportunities. I think a lot of people are very interested in the opportunities that BitFarms can get into now. Like you talked about the monetization routes, right? Whatever is the quickest, Washington, Sharon, and Panther Creek, right? So if you've worked with T5, so right now, as I understand it, T5 is your partner, they're gonna help you, know develop the the first f first 50 megawatts of that how you know so after T5 is gone you guys will be the ones doing all the the subsequent uh phases of Panther Creek if that's the case you know we have one of the main things that we see now is rack density right it's moving very quickly so right now you You know, if you want to run the GB300s, you're looking at, you know, at least 140, around there at 150 megawatts. And that's before the, well, yeah, that's the kilowatts, 150 kilowatts rack density. So after you've built the first phase and T5 is gone, do you feel confident that you have the in-house experience? to move forward with the other phases and if the design changes start, you know, the requirements start changing.

Ben Gagnon: Yes, that's a great question. You know, one of the things we really liked about T5 is that they work with every single hyperscaler out there to build and operate data centers. And there aren't a whole lot of strategic parties that we can work with that can help us out soup to nuts. You know, they're able to do everything from helping us out with the design, engineering, permit application process, through general contracting, through go-to-market, operations and maintenance of the site once it's actually up and running, upgrading of the site later on, or even decommissioning of the site, you know, a few decades down the road. And so the agreement that we have in place with T5 is one that we can continue to expand upon. through a greater and greater scope of services. And I think one of the areas that I think is important for people to understand is that we don't expect to be running these data centers at a Google level quality ourselves. I think any expectation that somebody who's never done this before and doesn't have the experience that they're gonna be able to do this all in-house, like day one, is kind of misguided. The reality is, is that when you speak with these hyperscaler customers, they want to work with the companies that they already work with who operate and maintain their data centers. That gives them a level of trust and certainty that things are going to be done right. And so there's a level of scope where they're going to be comfortable with a Bitcoin miner to provide power and land and maybe build out a powered shell. But if you're not working with the right counterparties who are proven, who are reputable who they already work with and know and trust, the reality is, is that you're going to lose them in the process. And so we've always positioned this as, look, we need to bring in the right people internally, but we also need to work with the right strategic partners because when we're trying to go after, whether it's a Microsoft and Amazon and Oracle or Corweave, what have you, they're going to want to work with companies which are proven operators. And T5 is one of those companies out there that we can work with, that they're all comfortable with, and we'd be able to increase the scope of the engagement over time to keep providing those services just with that one counterparty. And that provides a lot of risk reduction on our end. It also provides a lot of efficiency because now we're able to just move more aggressively. We're able to do everything under one shop, and we don't have to worry about working with six or seven different counterparties to try and provide a data center and provide operations and maintenance. We can just do it with one. So having those strategic partners is really, really crucial. And I think the other aspect of your question was with regards to just timelines to HPC revenue. You know, as I mentioned earlier, we're really focused on optimizing what is the fastest pathway to HPC revenues. And we've identified those three sites. I mean, we've got 14 different sites in our portfolio. We're focused on three right now for 2026, but that doesn't mean the others don't have, you know, HPC revenue conversion potential and a whole lot of value associated with them. But nobody cares really what you can do beyond 2027 right now. This is an execution game. And so, like I said earlier, it's execute, execute, execute. How do you get to HPC revenues in 2026? And, you know, I think Washington is a really, really interesting site. When you look at the different sites that we have, we kind of have two kinds of sites. We have sites, which I define as 10 to 50 megawatts, and we have campuses, which I define as over a hundred megawatts. There's different kinds of customers for those two sites. When it comes to the sites, we're really looking at enterprise customers. So you can think of those as S&P 500 companies that have data center needs, but are not data center companies. These might be an energy company like ExxonMobil, who's using their own compute to better understand how to drill, better understand where to drill, better understand how to extract value out of their systems and their supply chain. It could be financial companies who need their own modeling for, you know, their algorithmic trading or for trying to better understand how market demands are evolving in different parts of the world. It could be entertainment companies like Disney who are using this for, you know, content creation and special effects and all of these different applications. These are companies that are investment-grade counterparties. but don't want to be a data center business. They just have those data center needs. And so they tend to be a little bit easier to deal with. They tend to pay a little higher margins because they want you to provide a higher scope of service. And they also have a smaller demand, right? They're not looking for 300 megawatts. They're looking for 10 to 50 megawatts, and they're looking for a site that they can fully control, and they are not commingling with some other counterparty. You know, Exxon doesn't wanna have their compute in the same site as BP, right? Disney doesn't wanna have their same compute in the same site as Paramount. This is just the reality of the market for those counterparties. And, you know, on those areas, those smaller sites, what we're looking at is it probably makes a little bit more sense to go further up the stack to get more value creation. You know, these are the areas where the smaller scale means it's easier to raise the capital, it's easier to execute, and we can get, you know, a lot higher value creation per megawatt. When you look at the campuses, The campuses, you know, which are 100 plus megawatt, you know, gigawatt potentially with, you know, sites like Scrapgrass, those are sites where it would be cost prohibitive to do it all the way up the stack. The amount of capital we'd have to raise to go and do full GPU as a service for a gigawatt is, you know, it's probably like more than 100 times our market cap right now. So it doesn't make sense for us to really have those kind of ambitions. What makes sense is to match the amount of capital allocation relative to the scale of the site and the opportunity with the customers so that we can actually ground ourselves in reality and we're able to execute, execute, execute. And so, we're looking at how do you find the right strategic partners for the campuses, and really that's hyperscalers and neo-clouds. That's not enterprise companies. These are the companies who are able to take that compute and sub-segment that out to multiple companies through their own software stack. And I really don't have a whole lot of desire to compete with AWS. I think they beat us by a country mile on every single metric that you can possibly imagine. But we can work with them, and we can support them in their mission, and we can create a lot of value in doing that. And so that's how we kind of look at the two different sites, you know, categories that we have and the two different customer bases so that we can build up a really nice well-diversified customer portfolio of different sites, different customers, different business models, different contract vehicles, and we can build something that is really going to last.

Elkama: Okay. You've mentioned that full-service a couple of times, and I've heard Alex Brammer also use the term full-service, and just now, you've mentioned full GPU as a service. Would there, for Washington, it's not a huge site. It's about 18 megawatts. And even 18 megawatts would require quite a bit of CapEx. But would you ever go that route if that opportunity presented itself, where you were actually providing the full GPU as a service and running clusters? Or is that something not in the cards for you guys at this point?

Ben Gagnon: So, you know, our focus is really on infrastructure. We think that's where you get the most tangible value and the most stickiness. The compute depreciates really, really quickly. It's just like Bitcoin mining. You know, you end up in this really CapEx intensive cycle where I've got to raise money, I got to deploy into compute, and next year I got to do it all over again. I think that the better value here is taking the derivative of the compute and position ourselves on the right side of the supply and demand chain by solving that problem for the people who've already made that investment into the compute. The one exception to that rule would be at really small sites like Washington, where there could be GPU financing in place, where we're not actually taking that risk on ourselves, but it's a pass through to the customer, and we're charging a markup on top of that. So that's not something that we're ever, you know, or we're not really considering at all for the campuses, but for the smaller sites like Washington, there is potentially an opportunity to go beyond that, but it has to be done right. I don't want to own the depreciation of the compute. I want to own the infrastructure and the stable cash flows it generates.

Elkama: Yeah, that's a very good answer because I think we're starting to see that with, one of your competitors now, right? They're not looking to own the GPU. So they're looking to finance the GPUs and not take the full depreciation hit and run the same hamster wheel as what the ASICs are, right? So you don't want to go from an ASICs hamster wheel into a GPU hamster wheel. Okay, so let's get into the other opportunity that you mentioned on HC Wayne, on the presentation on HC Wainwright. And that was, you know, the potential opportunities are coming from overseas, more specifically the transatlantic opportunities from Europe, because your sites are located so close to the connection points of the submarine cables. Has anybody from Europe or any entities that are European based? inquired about your sites.

Ben Gagnon: So we haven't seen specific European counterparties who want to invest in the sites, but the reality is that the hyperscalers have a real hard time scaling in Europe. Getting huge access to large amounts of power in Europe is a huge problem. It's a problem on a regulatory side, it's a problem on a cost side. And so what they're looking at is, what are the North American sites that they can invest in that can serve a dual purpose and have minimal latency? Because the reality is, is that the HPC customers in Europe are already being redirected to North America. They just don't have the data center infrastructure capacity there in Europe to meet European demand, and it's gonna take Actually, I don't know what it's going to take in Europe to kind of solve that problem. But it's not something that's going to be solved in the next, let's say, one, two, or probably even three years. You're going to need probably a very big problem. political change in Europe in order to enable that kind of development on the energy side that enables that kind of development on the HPC and AI side. And in the meantime, areas like Pennsylvania will be able to serve East Coast metropolitans, and they'll tap into those undersea fiber optic cables to service an international clientele. that can't be serviced otherwise. There could be other areas for Europe, like in the Middle East, but there are challenges with investing in the Middle East. You know, it's a very different political environment where, you know, you just don't have the same rule of law. You don't have the same certainty. And if there's any, you know, companies who have concerns on a legal side or an environmental side, they're much more likely to invest in the United States because it's a much more risk-reduced position. What happens if you invest, you know, 10s of billions of dollars in the Middle East and there's no other demand? You're not getting it out of Europe, but if you invest in in the United States on the East Coast, you're able to tap the US market. And in those off hours, when the US market is asleep, you're also able to tap into this European clientele. So we're not seeing specific European demand, but we're seeing demand from North American companies who are looking to service the East Coast and beyond.

Elkama: We've talked about a lot of the opportunities. We've never discussed anything in Canada. You know, you have a couple of sites there that I think are very attractive, right? The first one being Bunker. At 48 megawatts, I would believe that's one of the biggest sites, you know, that's in the jurisdiction of Canada at the current time, right? At least on the East Coast anyways. Are there any potential suitors for Bunker or? some of the other sites that are just outside of Montreal, because they all range from 20 to-- you have at least three sites that are 20 to 40 megawatts. You have Bay Como at 22, you have Leger at 30, and Bunker at 48. They're very close to Montreal.

Ben Gagnon: It kind of surprises me that being an analyst isn't your day job, Kama. That's a pretty astute comment. When you look at our Quebec assets, we've got eight of them. Three of them are in an area called Sherbrooke. Sherbrooke is the largest town outside of, well, the largest city outside of Montreal. It's got a big university there, and it's got a bunch of fiber. When we're looking at Quebec, Sherbrooke is our number one target for conversion. But the reality is that the demand is first and foremost in North America, and our visibility to HPC revenues is much faster in North, sorry, in the United States than it is in Canada. And so that's how we're prioritizing demand. and prioritizing our efforts to develop and convert over these sites. All of our Quebec assets are, you know, free cash flowing out of our Bitcoin mining operations. They're spitting out, you know, good revenues, good free cash flow, but it's gonna take some time for us to navigate the regulatory environment. The challenge in Quebec is that, you know, we have you know, frankly, we have a political regime, which has never really liked Bitcoin, never really liked Bitcoin mining. But we've been there for so long that they can't do much about us. They have to service us because they're contractually obligated to service us. But it's very difficult to get new growth in Quebec. At the same time, There is a federal and national strategic priority around data sovereignty and data center investment, specifically around HPC and AI. And there is a provincial strategic priority to get data sovereignty in the province and to have HPC and AI investment in the province. And so there's a lot of broad political support for this development, but our megawatts are specifically attached to crypto mining. And we're going to need to go through a conversion process to convert over our tariff and our energy contracts with the province and with the hydro municipalities to convert them from crypto mining megawatts to HPC megawatts. There's a lot of political support for this, but we're the first people to try and there is no established framework. So we're pretty confident that we're going to get there, but we just don't know what it's going to take and when we're going to get there. And so in the meantime, we're focused on how do we get those revenues in, you know, early as possible in the United States. And that's why we're really focused on Washington Sharon and the first 50 megawatts of Panther Creek. I think Quebec is going to be a huge value opportunity, but I think it's a few years out.

Elkama: Yeah, I looked at some of the other Quebec competitors, you know, I'm pretty sure you've heard of Qscale. And I think your total power portfolio would be even bigger than theirs when they're fully energized. So I think in the future, Canada definitely has a big future, a part in the part of the plan, right? Bitfarms has a lot of megawatts in Canada. And like you said, Canada is not very pro Bitcoin mining, but they have an agenda. They have a mandate to go towards the AI HPC. And I take it as a compliment that you said I do this, I wasn't a professional, and I surprised myself that I only do this as a hobby. But having said that, I think Bitcoin Butcher has a lot of financial questions that he wants to ask. So I'll turn the mic over to Butcher.

Ben Gagnon: And just happy to answer one or two more questions, but it is an hour, so I can do maybe another 5, 10 minutes, and then I'm going to have to drop for another call.

Elkama: Yeah, no problem. Let's go.

₿itcoin ₿utcher: I'll keep it quick. Ben, thanks for joining us. Real quickly, the main question on everyone's mind is, how do you guys pay for this? You have the Macquarie financing arrangement, if you could speak to that. And then I'm just curious, with respect to your share buyback program, what was the thought process behind that, given the capital-intensive nature of the data center build-outs? Thanks for your time.

Ben Gagnon: Yeah, so we've designed the Macquarie facility to finance the first phase of construction at Panther Creek. So the 300 million facility is enough for us to do the first 50 megawatt building, a lot of the civil works, the substation, the transmission interconnection, the fiber lines for the first phase, and a lot of the other works for the second phase. You know, you're right, it's a drop in the bucket of everything that we're gonna need to build out the entire site, but it's enough for us to do all of the first phase. And when you go back to that comment that I had earlier that, you know, we're in a stronger and stronger position, the closer that we get to rack ready and energization to kind of tap into that, you know, missed opportunity cost on the customer side. You know, this is the financing that we needed to get to that point, to continue executing, to continue building, to preserve all of those timelines and bring us up to that point where we can lock in what we believe is gonna be a lot higher value and a lot better contracts. But we will need to raise more money as we continue to advance the development there for phase two. As we look at Washington and Sharon, those are sites that we're going to follow a very similar financing structure. What we're doing is we're wrapping up individual sites in special purpose vehicles, and then we're pursuing asset-specific financing. So Panther Creek has its own financing, Moses Lake will have its own separate financing, and Sharon will also have its own separate financing. The reality is this is a very, very expensive industry to get into. And we don't want to be using our equity more than we have to. And we definitely didn't want to do it a few weeks ago when we were at significantly lower prices. And so when we started out on the stock buyback program, it was really because Look, our shares were incredibly undervalued. We still believe that our shares are undervalued. And, you know, why should we not take advantage of this opportunity when we know what we have coming, when we know what we have in the cards? Why are we not putting our own money where our mouth is? You know, we're not being held back in the stock price because we were unable to execute, we were being held back for factors outside of our control. And, you know, as Riot continued to unwind their position, I'm happy to buy those shares from them on the open market. And I'm happy to take those off the balance sheet and out of outstanding common stock. And, you know, guess what, we're up over 100% on every share that we've already purchased. So I think that was a great deal for shareholders, I think that was a great deal for everyone. And we'll continue to reevaluate how we're running the stock buyback program. At the end of the day, that's not what's going to unlock the multiple expansion that we're targeting. But when we are so undervalued and we know it, why are we letting everyone else get those cheap shares?

Elkama: Yeah, Riot's not getting any of those cheap shares now, are they?

Ben Gagnon: You know, I don't know where Riot's at right now. We won't know exactly where they are probably until their Q3 reporting. So probably around the end of October, you know, there's going to be a disclosure of, you know, Riot sold X shares for Y dollars with Z shares remaining. You know, the last filing they had was August 18th, that 26 and a half million shares, just under 5%. So that means they have no more you know, filing requirements as they wind down. We know that they've been active in the market, but, you know, nobody knows exactly how many shares they have left. But, you know, we think they're relatively close to being out and we think the amount that they have right now is, you know, at this point, it's pretty immaterial.

Elkama: Okay. All right, having said all that, I really appreciate you coming on here. You've taken an hour of your time, and I know you have another meeting coming up. Would you be open to doing this again sometime? Maybe when BitFarm hits?

Ben Gagnon: $10? Yeah, BitFarm hits 10 bucks. It's a deal.

Elkama: It's a deal? All right. Can we have an interim deal? BitFarm hits $5 and we do a shorter one, like half an hour, and $10, we do a full hour.

Ben Gagnon: I'm happy to do an hour at both of those prices.

Elkama: Okay, so we have a deal. So if we get BitFarms at $5, we'll do an hour. BitFarms at $10, we'll do another hour.

Ben Gagnon: Okay, we'll see you next week.

Elkama: Okay, take care. Have a good one, Ben.

mid-level cruiser: Thanks, Ben.

Elkama: Bye. Bye, guys.

₿itcoin ₿utcher: Thank you.

Elkama: All right, everybody. So I guess that's it. Wait for BitFarms to hit $5 and we'll see another space with Ben Gagnon, $10 and we'll do another one. Maybe I can bargain for another one at 750, right?

mid-level cruiser: That was good.

Elkama: 45 minutes.

mid-level cruiser: That was good bargaining. And I just wanna say, I think after listening to Ben talk, even at 290 a share, I think BitFarms is a Van Gogh and a flea market, possibly. It's a war at a dollar store. I don't know what piece of fine art it is, but man, what a technical guy. That was a pleasure listening to him talk.

Elkama: It's very different. The type of interviews that he gives is not the same as some of the other CEOs who are not technical, right? Like he'll go into a lot of the technical stuff and you know, It's already an hour, and we didn't get to some of the questions that we wanted to get to this time, right? Because he has so much information, so much stuff to give us. So let's hope BitFarms gets to $5 soon, and we can have another chat with him again, right?

mid-level cruiser: Absolutely, yeah. I'm buying shares right now after hours.

Elkama: There is a slight pump up another percent at 292, so we'll see what happens tomorrow. But it's been on an incredible tear. Like I think anybody who's jumped on it since last week has made a lot of profit, especially if you jumped on, you know, when Ben bought, right? When Ben bought, if you followed, you would have made a lot of money now, especially if you did it through calls. Okay, everybody. Thank you for joining us, and let's look out for the BitForm price. If it hits $5, we'll announce it.

mid-level cruiser: Man, go in the flea market. Thanks, everybody.

Elkama: Okay. See you, everybody. Bye-bye.