Bitfarms scales through Paraguay and Stronghold acquisition

Bitfarms closed its acquisition of Stronghold Digital Mining in March 2025, creating the largest merger between two public Bitcoin miners. This transaction adds 165 MW of nameplate power capacity from the Scrubgrass and Panther Creek facilities located in Pennsylvania. The acquisition brings 4.0 EH/s of hashrate into the Bitfarms ecosystem. You should notice how this changes the company’s geographic footprint from a mere 6% U.S. presence to something much larger. The deal includes $125 million in equity value and the assumption of $50 million in debt. Founded in 2017 and headquartered in Toronto, Bitfarms operates mining farms in Canada, the United States, Paraguay, and Argentina. This merger aims to provide a path to 950 MW of active power capacity by the end of 2025. The transaction provides access to the PJM grid, which serves the largest wholesale electricity market in the United States. Gregory Beard, the Chief Executive Officer of Stronghold, expects the combination to maximize value for shareholders through increased operational expertise. The deal involves a stock-for-stock merger where Stronghold shareholders receive 2.52 shares of Bitfarms for each share they own.

Scaling Paraguay’s hydro infrastructure

The expansion in Paraguay reaches a new stage this month. The 6.3 EH/s addition to the Yguazu site uses hydroelectric power, providing a lower cost than the medium-tension connections that drove many mid-market operators out of the country. While HIVE Digital Technologies acquired the 200 MW Yguazu site in early 2025, Bitfarms remains active in the region. HIVE Digital Technologies aims to reach a global hashrate of 25 EH/s by September 2025. The 200 MW Yguazu site follows a two-phase development plan, with Phase 1 completion scheduled for April 1, 2025. This phase adds 6 EH/s of capacity, while Phase 2 adds 6.5 EH/s using hydro-cooled ASICs.

The Paraguayan grid relies on the Itaipu, Yacyreta, and Acaray dams. ANDE, the state utility, recently increased medium-tension rates from roughly $0.03/kWh to nearly $0.06/kWh. This price hike, combined with a requirement for three months of energy costs as a deposit, makes operations harder for companies without high-tension infrastructure. I consider the reliance on a single state utility monopoly in Paraguay a massive risk. Can the company maintain these margins if the 2027 contract expiration cliff approaches?

Managing financial volatility

Bitfarms’ financial performance shows a volatile path. While the company reported $69.2 million in revenue for 3Q25, a 12% increase over the previous quarter, it recorded an adjusted EBITDA loss of $9.6 million in 4Q25. This loss follows a positive adjusted EBITDA of $19.6 million in 3Q25. The company also reported a net loss from continuing operations of $139.9 million for the 4Q25 period. I consider the current financial trajectory worrying because the company struggles to keep its profitability stable despite growing its hashrate and energy capacity.

Wall Street analysts maintain a Buy consensus for BITF, setting a price target of $3.90. The company held $147 million in liquidity at the end of 2024, which included $60 million in cash. Despite the recent losses, the 97% year-over-year increase in hashashrate to 12.8 EH/s at the end of 2024 shows operational scaling. Bitfarms faces pressure to manage high capital expenditures for scaling high-performance computing and AI operations while upgrading and maintaining its expensive mining equipment to prevent quick obsolescence. The massive scale of the Stronghold acquisition provides the necessary infrastructure to survive the current volatility. The company also earned 2,914 BTC for the full year 2024, though production declined 41% compared to the previous year’s 4,928 BTC. The Synthetic HODL program generated $18 million in trading profits with a 135% return. This program helps provide low-cost capital during periods of Bitcoin price appreciation. Regarding operational capacity, Bitfarms expanded its megawatts by 35% in 2024, reaching 324 MW.