Erke Huang: Yes, I mean, our experience for procuring, those specialized equipments, came all the way back to, when we were in the Ethereum, PoW business. And we built those relationships, with NVIDIA and Super Micro, in the semiconductor industry partners. And it comes when we were trying, to procure those H100 servers. So NVIDIA and Super Micro give us quite a lot of support. And that’s how we could procure those equipments, in such a short period of time, and also install them in Iceland, with our expertise in international logistics. And frankly, I was at NTTC yesterday. I’m going to have meetings with Super Micro right after this call. So, it’d be good to, and keep the relationship and to, for our future growth.
Kevin Dede: Wonderful gentlemen. Thanks for taking my questions. Appreciate it.
Operator: Thank you so much, Kevin.
Sam Tabar: But Kevin, thank you for highlighting. That is one of our secret sauces, in terms of our access, to get these machines from legacy relationships that, we’ve had going back years.
Operator: Next we have, next speaker, we have Joshua Zoepfel from Noble Capital Market. Please go ahead, Joshua.
Unidentified Analyst: Hi, can you guys hear me?
Operator: Yes.
Unidentified Analyst: Hi, guys, it’s filling up for Joe. So first off, I want to congratulate you guys in the year. Obviously you guys, obviously talked about the AI how it’s kind of transforming a little bit of the business, and how it’s adding a good revenue stream, to you guys in 2024 and forward. I just wanted you guys to say, kind of answer something with, just in terms of the mining business. Have you guys already kind of had talks, with like just companies in regards to their miners? And are they kind of, like ready to like kind of sell those, or are they kind of holding off until the halving event and then seeing what’s going on from there?
Sam Tabar: There’s been, I’m happy to take that call, that question. There’s been a lot of talk. We do get approached often about buying machines. But I think a lot of people are waiting to see what happens, after the halving. Historically, as you know, Bitcoin goes up quite a bit after the halving. One of the reasons why Bitcoin has gone up, a lot now and this is just my opinion, is that the Bitcoin ETFs have caused massive inflows into Bitcoin. So it’s quite possible that the Bitcoin halving event, that has not been the catalyst, for the spike in the price of Bitcoin going up. So, there could be another catalyst after the halving event once that happens. And of course, if that’s not overnight. It historically takes a while, could take a few months, even up to a year.
But until people figure out where Bitcoin’s going to be, where it ends up stabilizing. Then people are going to start taking a view, as to whether they’ll sell their equipment, or not. So, I think there’s a lot of holding going on right now, and people are just waiting to see.
Erke Huang: Just to specify, there’s no bottleneck from a OEM procurement perspective. Like we have all the access to miners we want, or need right now. It’s more just a, product of us timing the growth.
Unidentified Analyst: Okay. Thanks guys. And then this is obviously, I’m kind of looking at the productions you guys release monthly. And over the past few months, over the past few months, we’ve kind of noticed the increase in network difficulty. You guys kind of expect this to continue just going forward, even with the halving?
Sam Tabar: Cam, do you want to take that?
Cameron Schnier: Yes, I mean, there’s plenty of miners coming online. Like if you look around at the public miner landscape, there’s been pretty massive growth announcements and a lot of that has not yet been deployed. And obviously there’s a lot of growth in the non-public realm that, is harder to track. But historically you do see a pretty meaningful portion, of the network hash rate drop off, following the halving events. So, it might not be, as dramatic of a decrease post halving this go around, but we would still expect some meaningful number to fall off, post halving and commensurately reduce difficulty.
Sam Tabar: Yes, to Cam’s point, I think it’ll be much less than it was in the past only, because the industrialization of Bitcoin is here unlike the other halvings in the past. And with the industrialization of Bitcoin comes the ability to absorb shocks. And so I think it’ll be less of an impact than in the past.
Operator: Thank you, Sam. Thank you, Josh. Okay. For the next speaker, we have Edward Engel from Singular Research. Please go ahead, Edward.
Edward Engel: Hi, thanks for taking that question. Can I confirm you can hear me?
Sam Tabar: Yes. Thank you.
Edward Engel: Great, thank you. Yes, I just wanted to talk about the high level, the cost structure on the AI business. Specifically, would it be fair to assume that the gross costs, specifically the energy costs are decently lower for AI than Bitcoin mining?
Sam Tabar: Much more, but I’m unsure what I could say in terms of MMPI, but I’d like to, I know what the numbers are, but I’m unsure, if we’re allowed to disclose that. Cam and Erke.
Erke Huang: The electricity costs on a per revenue basis are dramatically less.
Edward Engel: Great, just wanted to confirm, yes. And I guess from a footprint perspective, for the same level of square foot, would AI also be more profitable?
Erke Huang: Yes, if you look at our, like we’re running less than around two megawatts for that $50 million run rate, so on a per revenue basis compared to, we were using around 80 megawatts on the mining side, which generated $44 million of revenue in 2023. Obviously, Bitcoin prices are much higher, but even with that increase, I mean, it’s from a footprint perspective, we’re able to generate a lot more revenue on the AI side.
