TSXV: CSTR
OTCQB: CSTXF
TORONTO, Nov. 15, 2021 /CNW/ - CryptoStar Corp.
(TSXV: CSTR) (OTCQB: CSTXF) ("CryptoStar" or the
"Company"), a cryptocurrency mining and data centre
operator, is pleased to announce that it has signed a letter of
intent (the "LOI") effective November
12, 2021 to acquire 100% of the outstanding shares of Neuro
Digital Inc. ("Neuro Digital") for cash consideration of
CAD$2.4 million (the
"Transaction"). The Company is also pleased to announce the
expansion of its self-mining Hashrate.
Neuro Digital Transaction
Highlights of the proposed Transaction:
- Under the terms of the LOI, it is anticipated that CryptoStar
and Neuro Digital will enter into a binding agreement (the
"Definitive Agreement") pursuant to which CryptoStar will
acquire 100% of the outstanding shares of Neuro Digital.
- Neuro Digital is a data centre operator specializing in GPU
mining, Decentralized Finance (DeFi) and AI solutions with an
operational data centre located in Quebec, Canada (the "Quebec Data
Centre"). Neuro Digital's current, proof of concept location
has a power capacity of 0.5 megawatt (MW) with plans for
expeditious expansion in various locations that have been
identified throughout the province of Quebec.
- The currently operating Quebec Data Centre is powered by
competitively priced, reliable, on-the-grid, green
hydroelectricity, aligning with the Company's commitment to the
Crypto Climate Accord.
- Neuro Digital currently has an aggregate self-mining Hashrate
of 83,162 MH/s from GPU miners running at the Quebec Data
Centre.
- The additional 83,162 MH/s of Hashrate from Neuro Digital's GPU
miners would add USD$199,448.78
(CAD$249,310.98) per month in
self-mining revenue for the Company based upon current market
conditions. (Source: https://whattomine.com/ Mining metrics
are calculated based on and ETH - USD exchange rate of 1 ETH =
$4,713.58 updated at 2021-11-15
12:20:35 UTC).
- Key management personnel of Neuro Digital will remain with the
company and will be responsible for the expansion of CryptoStar's
operations in Quebec, Canada.
- The agreed upon consideration under the proposed Transaction
will be satisfied by the payment of CAD$2.4
million in cash.
- It is anticipated that the Definitive Agreement will be
executed no later than December 15,
2021, subject to the completion of due diligence.
David Jellins, President and
Chief Executive Officer of CryptoStar states, "We are delighted
that Neuro Digital has agreed to the terms of the proposed
Transaction, and more specifically, we are looking forward to
incorporating the extremely talented team at Neuro Digital with a
proven expertise in Ethereum (ETH) mining, AI solutions and DeFi.
Furthermore, this acquisition will ensure our expansion of green
operations in Quebec, Canada and
is another step toward transitioning our operations to renewable
sources."
Summary of Existing CryptoStar Business (pre-Neuro Digital
Transaction)
- The Company successfully deployed an additional 10 PH/s of
Hashrate from ASIC miners announced on September 15, 2021, more than two weeks ahead of
schedule.
- The Company currently has an aggregate self-mining Hashrate of
93,608 MH/s from GPU miners and 67.2 PH/s from ASIC miners running
at its data centres.
- The deployment of 93,608 MH/s and 67.2 PH/s of existing
Hashrate from GPU and ASIC miners currently contributes
USD$11.7 million in annualized
self-mining revenue for CryptoStar. (Source:
https://whattomine.com/ Mining metrics are calculated based on and
ETH - USD exchange rate of 1 ETH = $4,713.58 and a BTC - USD exchange rate of 1 BTC
= $65,667.99 updated at 2021-11-15
12:20:35 UTC).
- The Company purchased 600 high performance ASIC miners to be
delivered in 6 equal tranches of 100 miners during calendar 2022
commencing in January and ending in June. This will increase
the Company's self-mining Hashrate from ASIC miners by 8.8 PH/s
each delivery month, resulting in a total self-mining Hashrate
increase from ASIC miners of 52.8 PH/s.
- The deployment of a total Hashrate of 120 PH/s from ASIC miners
would generate approximately 20.4 Bitcoin per month based on
current difficulty levels. (Source: https://whattomine.com/ Updated
at 2021-11-15 12:20:35 UTC).
- The Company has executed Equipment Hosting Agreements for an
aggregate mining capacity of 37 MW which are expected to contribute
up to USD$14.8 million in annual
hosting and power revenues for the Company, with the hosting
services in Alberta, Canada
expected to commence in Q4, 2021 and Q1, 2022.
- As at November 15, 2021, the
Company has made payments and deposits for ASIC miners,
infrastructure equipment and engineering services of USD$3.6 million (CAD$4.5
million). The company also holds USD$947,000 (CAD$1,184,000) in inventory for sale.
- The Company is in a strong financial position and is well
capitalized. As at November 15, 2021,
the Company held 326 ETH, 65 BTC and USD$12.0 million (CAD$15.0
million) in cash.
About CryptoStar Corp.:
CryptoStar has cryptocurrency mining operations with data
centres located in the U.S.A. and
Canada. CryptoStar is currently
dedicated to becoming one of the lowest cost cryptocurrency
producers in North America and a
major supplier of GPU and ASIC miners worldwide.
Neither the TSXV nor its Regulation Services Provider (as that
term is defined in the policies of the TSXV) accepts responsibility
for the adequacy or accuracy of this press release.
Forward-Looking Statements
This news release contains forward-looking statements.
Forward-looking statements can be identified by the use of words
such as, "expects", "is expected", "anticipates", "intends",
"believes", or variations of such words and phrases or state that
certain actions, events or results "may" or "will" be taken, occur
or be achieved. Forward-looking statements include those relating
to CryptoStar's expectation that the Company and Neuro Digital will
enter into the Definitive Agreement, expansion of the Quebec Data
Centre operations, that key management personnel of Neuro Digital
will remain with the company, the timing of the finalization of the
Definitive Agreement, the expectation to transition the Company's
operations to renewable sources, the expected revenue and timing to
commence the hosting and power services associated with the
Equipment Hosting Agreements, the expected revenue generating
capabilities of the GPU and ASIC miners, the expected Bitcoin
revenue generating capabilities of the ASIC miners, the time to
deliver and deploy the ASIC miners, CryptoStar's plans to continue
to expand its self-mining inventory of mining hardware, increase
its power capacity at its data centres in Alberta, Canada, expand its data centre
operations in Alberta, Canada, to
partner with large cryptocurrency miners and CryptoStar's plans of
becoming one of the lowest cost cryptocurrency producers in
North America and a major supplier
of GPU and ASIC miners worldwide. Forward-looking statements are
not a guarantee of future performance and are based upon a number
of estimates and assumptions of management in light of management's
experience and perception of trends, current conditions and
expected developments, as well as other factors that management
believes to be relevant and reasonable in the circumstances. Actual
results, performance or achievement could differ materially from
that expressed in, or implied by, any forward-looking statements in
this press release, and, accordingly, you should not place undue
reliance on any such forward-looking statements and they are not
guarantees of future results. Forward-looking statements involve
significant risks, assumptions, uncertainties and other factors
that may cause actual future results or anticipated events to
differ materially from those expressed or implied in any
forward-looking statements. Except as required by law, CryptoStar
undertakes no obligation to publicly update any forward-looking
statements, whether as a result of new information, future events
or otherwise.
SOURCE CryptoStar Corp.