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Sunday, September 25, 2022

MGT Capital Investments Inc. (OTCMKTS: MGTI) the Bit5ive Bitcoin Mining Reverse Merger

MGT Capital Investments Inc. (OTCMKTS: MGTI) is making an explosive move up the chart after the Company announced via a press release and 8k filing that Bit5ive LLC was reverse merging into the Company. Bit5ive is an American technology company founded by Robert Collazo and a leader in the cryptocurrency mining and infrastructure space. Their cutting-edge modular data centers and management systems enable institutional-scale investors to break into cryptocurrency mining with a turn-key approach. Bit5ive is an official distributor in South & Central America of Bitmain PTY, the world’s leading cryptocurrency mining hardware producer. Bit5ive currently has bitcoin mining operations Colorado, Nebraska, Texas, Florida, Ohio, Washington, Georgia, South Carolina, and Sweden. 

Reverse merger SPACS can be more explosive than biotech’s when the incoming Company has real value but is undiscovered to investors and many RM stocks, we have covered on this website have gone from pennies to dollars. Two recent RM runners that stand out are TSNP which went from sub pennies (where we first wrote about it) to several dollars per share. The other is HRBR which went from a few cents (where we first wrote about it) to $3 plus. As per the press release the newly combined entity would become significant player in bitcoin mining infrastructure. MGTI is a clean corporate structure with just $1.2 million in liabilities that currently does just under $100,000 a month in revenues from bitcoin mining and hosting services. Recently management consolidated activities at a Company-owned and managed facility in LaFayette, GA. Located adjacent to a utility substation, the several-acre property has access to about 20 megawatts (MW) of low-cost electrical power. Currently MGTI owns 480 and 430 Antminer S17 Pro Bitcoin miners (“S17 miners”), respectively, plus 35 Antminer S19 Pro miners as of March 31, 2022.  

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MGT Capital Investments Inc. (OTCMKTS: MGTI) is a U.S.- based Bitcoin miner with operations at an owned facility in Georgia. Following a review of the Company’s Bitcoin mining operations in early 2019, management consolidated activities at a Company-owned and managed facility in LaFayette, GA. Located adjacent to a utility substation, the several-acre property has access to about 20 megawatts (MW) of low-cost electrical power, about half of which is presently utilized by the Company. As of December 31, 2021 and March 31, 2022, the Company owned 480 and 430 Antminer S17 Pro Bitcoin miners (“S17 miners”), respectively, plus 35 Antminer S19 Pro miners as of March 31, 2022. All miners are located at the Company’s Georgia facility. MGT purchased a total of 1,506 S17 miners in the latter part of 2019 directly from Bitmaintech Pte. Ltd. From May 2020 through March 31, 2022, the Company sold a total of 923 of these miners.  

Microcapdaily first reported on MGTI on September 1, 2017 stating at the time: “MGTI is the brainchild of security whizz John McAfee of McAfee Antivirus who spent years in Belize than on the run and back in the US on top again. Mr. McAfee smartly realized that Bitcoin is the greatest and most disruptive technological advancement to come around in years and he has turned MGTI into one of the largest U.S. based Bitcoin miners with 2 facilities in Washington State already up and running and plans to deploy a third rig for early October 2017. Bitcoin is here to stay and if you don’t own one you are missing out on the greatest investment opportunities of our lifetime.” Unfortunately, John McAfee died last year which was sad. At one point several years ago, he was very unhappy with an article we wrote about him and since I was not around that day, I did not see his emails until the next day. By the time I called 2 days later and rectified the situation he was so angry at Microcapdaily he would not speak to me. He did post some of our articles on his twitter account. 

On September 14 MGTI announced the execution of a non-binding letter of intent to merge with Bit5ive LLC in a stock swap MGT believes will benefit stockholders of both companies. Subject to the execution of a definitive agreement and certain closing conditions — including the completion of Bit5ive’s financial audit and approval by Bit5ive’s members – the transaction will create a strong competitor in the design and operation of infrastructure used in the Bitcoin mining industry. The combined entity would become significant player in bitcoin mining infrastructure. 

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MGTI

Bit5ive is an American technology company founded by Robert Collazo and a leader in the cryptocurrency mining and infrastructure space. Their cutting-edge modular data centers and management systems enable institutional-scale investors to break into cryptocurrency mining with a turn-key approach. Bit5ive has been at the forefront of cryptocurrency mining; designing and deploying data centers. Their proprietary Pod5ive system enables them to quickly and easily deploy modular data centers optimized for Bitcoin and other cryptocurrency mining. This allows them to offer their clients the best possible performance and return on investment. Bit5ive is an official distributor in South & Central America of Bitmain PTY, the world’s leading cryptocurrency mining hardware producer Bit5ive currently has bitcoin mining operations Colorado, Nebraska, Texas, Florida, Ohio, Washington, Georgia, South Carolina, and Sweden. 

Under the proposed agreement, MGT would issue to Bit5ive’s existing members a number of shares that represent 70% to 80% of MGTI common stock outstanding on a pro-forma basis after giving effect to the merger.  Robert Collazo would be appointed Chief Executive Officer of the new company. Mr. Collazo stated, “We are excited to be entering the public market and bringing our company’s vision to the world.  Bit5ive has been growing rapidly, and we’re delighted about this next chapter which will help us continue to innovate and provide new opportunities for our investors, partners, and employees.” 

MGT today also announced a private sale of $1.5 million principal value of senior secured convertible notes and warrants, providing the Company with $1,335,000 in net proceeds. Except for the note transaction, which has closed, there can be no assurance that the actions contemplated above, including a definitive merger agreement with Bit5ive, will be executed on these terms, or at all. 

Bit5ive is an American technology company and leader in cryptocurrency mining and infrastructure. Its cutting-edge modular data centers and management systems enable institutional-scale investors to break into cryptocurrency mining with a turnkey approach. Bit5ive is committed to developing innovative solutions that power blockchain networks while providing competitive returns on investment. Bit5ive’s five pillars: Infrastructure, technology, education, environment, and lifestyle, underlie its mission to provide sustainability at scale within this growing industry. Bit5ive believes these core values will help achieve its mission of making cryptocurrency accessible to everyone while protecting our planet’s resources. 

 

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Currently trading at a $4.4 million market valuation MGTI OS is 683,770,903 shares. The Company is fully reporting OTCQB with a decent balance sheet with just $1.2 million in total liabilities currently doing just under $100,000 a month in revenues from its bitcoin mining operations and hosting services it provides. On September 14 MGTI announced the execution of a non-binding letter of intent to merge with Bit5ive LLC whereby MGT would issue to Bit5ive’s existing members a number of shares that represent 70% to 80% of MGTI common stock outstanding on a pro-forma basis after giving effect to the merger. Recently MGT management consolidated activities at a Company-owned and managed facility in LaFayette, GA. Located adjacent to a utility substation, the several-acre property has access to about 20 megawatts (MW) of low-cost electrical power. Currently MGTI owns 480 and 430 Antminer S17 Pro Bitcoin miners (“S17 miners”), respectively, plus 35 Antminer S19 Pro miners as of March 31, 2022.  Bit5ive currently has bitcoin mining operations Colorado, Nebraska, Texas, Florida, Ohio, Washington, Georgia, South Carolina, and Sweden. The newly combined entity would become significant player in bitcoin mining infrastructure. We will be updating on MGTI when more details emerge so make sure you are subscribed to Microcapdaily.

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

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