Good afternoon, everyone, and welcome to our virtual fireside chat with CleanSpark. I'm Mike Colonnese, Managing Director and Senior Crypto Analyst here at H.C. Wainwright. We are very excited to have Matt Schultz, CleanSpark's Executive Chairman, and Zach Bradford, Chief Executive Officer for today's event. Guys, great to have you. Really appreciate you taking the time. Thanks for putting it together, and thanks for hosting, Mike. We're excited. And, you know, just a personal, note of gratitude: the fact that you opened it up to all of our retail investors and anybody that might be interested is a big deal, so thanks for that. Yeah, appreciate it. Thanks, Mike. Absolutely. We appreciate fellow Bitcoiners here at the bank, and it's great to have you all on the call today. For those of you who aren't too familiar with the CleanSpark story, Matt and Zach are really the brains behind CleanSpark, a company that has grown to be one of the largest publicly traded Bitcoin miners in the world. Looking at it today, the company has a market cap of about $4.5 billion, and 16x the hash of total operating capacity online in hashing today. but what I really wanna zone in on too is, beyond the numbers, I've been very impressed by the company's corporate culture as CleanSpark has some of the most engaged employees I've personally met within the industry, having toured many mining facilities, throughout my career, from senior management all the way to the boots on the ground at the company's Bitcoin mining facilities throughout Georgia. And I think this is an important aspect to the story that I believe is really underappreciated, so I just wanted to touch on that. Now, before diving in, we also wanna remind investors on the call today that CleanSpark is our top stock pick for 2024 and is the only publicly traded miner to have outperformed Bitcoin year to date and by a wide margin. Looking ahead, we believe the company is well-positioned to not only continue outperforming its peers but also Bitcoin as we look out through the balance of 2024. As for today's agenda, we'll cover a number of important topics to better familiarize investors with CleanSpark's Bitcoin mining operations, growth initiatives, and explore how the company has been able to outgrow its peers in recent years. Today's event should run for about one hour, and if time permits at the end of today's session, we will pull questions from the audience. I'll also add, if you're interested in scheduling a follow-up one-on-one meeting with the management team after today's event, I'm more than happy to set that up. You can go ahead and send me an email directly, and we can coordinate that. With that being said, let's jump right in. We have a full agenda today. Matt, Zach, again, appreciate the time. I think it would be great to start, for those on the call who are relatively new to the story, to really kick off the discussion with an intro to CleanSpark, how you got into Bitcoin mining, and an overview of your operations today. Great. Yeah. So, it's kind of an exciting journey. I was speaking with somebody that said, "You know, you guys have pivoted from one thing to another, and now look where you're at." And I have a different perspective. I think if you stand where we are today and you turn around and look back; it's a straight line. So, Zach and I met on a renewable energy company whereby we had some intellectual property that enabled us to convert waste products into clean gas. And we evolved that company and merged with the microgrid company. So in our history, we understand energy generation, but through the microgrid company, we also developed a portfolio of IP that enabled us to have kind of insight on interoperability with the utilities and demand response programs and peak shaving and load balancing and different aspects and components of an energy system. What we learned is that Bitcoin is really all about energy and effective usage of energy and optimizing a team using all of the kind of advantages that came out of several years of renewable energy generation and development, modeling solutions around cost avoidance or time-of-use charges or even greenhouse gas emission exposure. And so, when you feather all that in and you layer it in, that really provides us some insight that I think maybe is unique in the Bitcoin mining space. Zach had an opportunity to fly out to potentially propose a microgrid solution for a Bitcoin mining company, back during COVID. He called me from the Atlanta airport. I could hear through his mask, saying, "Hey, hear me out. This is gonna sound crazy, but what if instead of selling these guys a microgrid solution, what if we buy a data center and we mine Bitcoin? Because I think understanding energy with the detail and granularity that we do, we could really do it different and better than everybody else." That was kind of where it started. You know, our board had just a little bit of, I think, lack of familiarity with what it meant to mine Bitcoin. So, it took an educational process. Zach did a great job. You know, we brought in a consultant that we bought the company from initially that had mined more than 50,000 Bitcoin personally. He kind of helped with our education into the space in that segue. And from that point forward, it's just kind of been, you know, off to the races. And, you know, props to Zach and the team. They've done an impressive job with execution. Yeah, it's truly been a great story. And sure sure, you're you're bearing the fruits of that that pivot now. So, it's, really great to see the progress over the years, guys. And if we fast forward, right, CleanSpark is the second-largest Bitcoin miner by market cap in the industry, second only to Marathon, really, a testament to execution, right? When we talk about growing faster than the majority of your peers over the past couple of years, what do you guys attribute the company's success to? And and really, what differentiates you from other miners out there? There's a lot of, public companies in the space that investors can choose from, but what differentiates CleanSpark? So, I'm gonna address something from where I sit that I think affects how I view the world, which is how we built the company around it. And that is strategy over ideology. We're in an industry that carries heavy ideology about what you should do with Bitcoin, how you should use Bitcoin, what it means. And at the end of the day, I personally buy into, you know, what Bitcoin means for the world. I think it can make it a better place. But we're here to run a company and be strategic. So, everything is done from a strategy over ideology approach. And that can mean not always pursuing the ideology. An example of this is we sold Bitcoin at the peak of the market last year because everybody else thought, "You should hold it." And I looked at the market and said, "Everyone's lost their minds. We've hit a point where; euphoria has taken over." And we sold it. And we continued to sell Bitcoin until last June. We really started rebuilding the balance because same thing. We looked at today, not the yesterday, and not what we want tomorrow to be, but had vision based on the facts that were in front of us and decided it was time to build our HODL. And the years between those two points, right, was a bear market. And we grew in the bear market. So, when everyone else was, you know, worried about, you know, today, we were growing for tomorrow because we positioned ourselves with no debt. We positioned ourselves where we had sold the our Bitcoin at the peak of the market, used our balance sheet the way we should in a healthy way, and we grew. We grew by acquiring a lot of distressed assets. So again, those are two points in time that were key inflection points for us. And right now, we're continuing to build into this market. And although the assets may or may not be distressed as we go into Halving, the opportunities are immense. And they're immense because of where we position the company. And, you know, I hate to use this word, but the word is relevance. And, you know, we knew or believed, I should say, three years ago, that we needed to be amongst the top four companies by market cap and by production. And everybody else would be irrelevant. If we were not one of those companies, we would lose on the opportunities for the next cycle. Because again, at the beginning of this cycle, we were thinking about what's gonna happen in 30 days. And now, as we were well prepared for it, we're gonna start to think about 2028. And I think the forward-looking mindset, always pursuing strategy above all else, has allowed us to be successful when, you know, the opportunities to me were obvious, but they clearly weren't for the rest of the market. And so, timing is something that we pride ourselves in and we're gonna continue to do because we also have a belief that success is rented, and rent's due every day. And that is a mindset of our management team. We need to be better tomorrow than we are today. We're not gonna ride on our laurels. We're not gonna say, "Hey, we made it," and high-five. We're gonna continue to build this company long into the future to be the very best Bitcoin mining company. A question on a lot of investors' minds as of late is why the public miners have underperformed Bitcoin to start the year, with the exception of CleanSpark. In your view, what forces are driving this underperformance, and why do you believe an investor should consider making an allocation to one of the large public miners as opposed to maybe purchasing into one of the spot ETFs or the digital asset itself? Oh, great questions. So, I think a couple of things. Obviously, share price has a lot to do with supply and demand. We've been very judicious about our use of equity. We told our shareholders two years ago that we would use equity if and when it was accretive within a couple of fiscal quarters. And we've really stuck to our guns on that. I mean, Mike, you know, through the bank that is your employer, you know, we've gone through a couple of $500 million ATM transactions. And during that same period of time, our shares are up 672% in 12 months. That's because of that disciplined approach. We haven't done an overnight offering. We didn't do a convertible to venture. We were very opportunistic when the market was strong. We raised capital when it made sense, and then we immediately deployed that capital. Just a, you know, quick gee-whiz file, right? We plan all this stuff way ahead. We started planning for this halving four years ago. And the fleet of equipment and the expansion that we're pursuing now is in preparation for 2028. So, it's really been strategic to, you know, not to echo Zach's points too strongly, but, you know, there are opportunities that there's deviations from the norm. We had an executive meeting this morning, and, you know, some of the stuff that's going on in Dalton is running a bit ahead of schedule, right? So, I don't know if you know this or not, but to fly if you were an ASIC miner and you wanted to fly to the United States, that ticket cost you $110, for that seat for one miner if you plan it a certain period of time in advance. Now, if you travel on short notice, that ticket's gonna cost you double. So, our team, just to give you an example, you know, they find out that we have 4,956 slots coming available sooner than we predicted. And so proposed spending doubles the price of a plane ticket for those 4,000 miners to get it here on time so we can put those things in place hashing before halving. So that's kind of the way we think about operations. And that's a very specific example, but I just wanted to highlight the fact that it's all about efficiency. Now, you know, relative to our peers, I think we've been more selective in the use of equity, but also more efficient in the deployment of equity, in the choices of the equipment that we've used, in the way that we build out our facilities. But more than anything else, it's about our people. I mean, we all have ASICs. We all have power supply units. We all have transformers. We all have switchgears. You know, everybody has basically the same thing. We chose a different path to start with. And that is vertically integrated, self-miners, and literally with very few exceptions, every person that touches a miner at CleanSpark is a shareholder of CleanSpark. So, our interests are aligned. We've brought maintenance and repairs in-house. They have microscopes with massive screens to do warranty work on our own fleet, all the way down to the chip level on site. So, we have this you know, we have a small fleet of surplus rigs, but when one goes down, we pull it off, put another one on, plug it in, the other one goes in the queue, and it gets fixed. So, we don't have these real big lagging periods of time. We're also not reliant on a third-party host. We control our own destiny. So, why invest in CleanSpark or a miner rather than an ETF? You know, it's a great question. You know, the ETFs have given credibility, as an asset class to Bitcoin. The difference is owning an ETF; you don't own the Bitcoin. You don't have the keys. You own exposure to Bitcoin. The ETFs sell exposure to Bitcoin. By definition, as you know, they're called spot ETFs. They acquire that Bitcoin at the then spot price in the market. As a Bitcoin miner, you've seen our gross and net margins; we acquire Bitcoin at about a third of that spot price. As a vertically integrated miner that holds Bitcoin, you're now investing in exposure to that same Bitcoin at about 66% less than what you're gonna get from an ETF. Then the last point on that, in December, about 12% of the Bitcoin rewards we received over a period of time were generated as a result of transaction fees on the Bitcoin blockchain. You don't have that benefit in an ETF or even on a MicroStrategy. We have the benefit of having opportunities to participate within that Bitcoin mining ecosystem to reap the rewards when the demand for block space is high. We get that benefit, and that directly impacts our shareholders. So, I know it's a really long answer to your question, but I think, you know, to use Zach's point, relevance, you know, these are all points of differentiation. And I think that's ultimately what's proven to be relevant to our investors, both retail but especially institutional. I mean, we're seeing a rapid growth in the number of institutions that have chosen to hold our security. Mike, I'm gonna piggyback on what Matt said. I'm gonna give him maybe a slightly condensed answer to this. Use of capital. Use of capital means you're buying machines and facilities. I believe we're among the top where we have the lowest costs to ultimately produce an exahash of all the miners. So, that's first point. Second point, if you look at all those servers, it doesn't matter if they're not producing Bitcoin, how many you have. It as far as production goes, you can see the production on the public blockchain. It's out there for everybody. One of our peers who is showing over 10x a hash, so about 60,000 more servers than we have, we're actually producing ±5% of what they're doing. So that means that there was capital deployed to buy 60,000 more servers than we have, and we're producing nearly as much as them. And we may even catch them this month. So again, I don't need to name names or anything on that, but my point is it's about how you deploy the capital at low cost, how you produce with that capital. And then the last point I'm gonna say is buying miners because of the ETFs. Because the ETFs buy at spot, and currently, they seem to have an insatiable appetite to scoop up more Bitcoin. That means that our margins are just gonna get better. So, the biggest, most efficient miners are going to reap an even bigger reward because of the ETFs. So, you're actually pushing a greater, you know, alpha towards a miner on a long-term basis. Really great insights, guys. Appreciate that. I'm sure it's very helpful to the investment community, both on the institutional and retail side on the call today. Switching gears over to taking a deeper look at your mining operations. Now, you own and operate five data centers in the state of Georgia, where most of your deployed capacity is currently located. What makes Georgia a good state to set up shop, and what strategic advantages or disadvantages are there to you having most of your capacity deployed in the one state? You know, when we got started, Georgia was an overlooked state to a large degree on Bitcoin mining. And I think it's actually smart to be overlooked unless you understand energy. So, if you go there, it's a regulated market, and the industrial rates are hour by hour. So, you need to be able to respond to the power prices on a real-time basis. Now, it's different than Texas. There are no big rebates if we turn off, and there's no fancy program that's in there. Instead, it's about predicting power prices, using power at the right time. Now, we don't turn our facilities off often. But for example, avoiding 100-200 hours a year, which is, you know, just a fraction of the time, we can have up to 30% less power prices. And so, coming from a background where we interacted with grids specifically for economic response, Georgia was the perfect home for us because it was really predictable. It's also a state with very abundant power. So, there's not a shortage issue, which is part of the reason they don't have all these other programs. So, it created us a home where we could really understand the utility, grow with the utility, develop relationships. We're the largest purchaser of power from one of our utilities or across three utilities. But one of those, you know, we are the anchor customer. That makes us important. It means we are buying power, and influence. You go to, you know, certain places in the globe, and you're just gonna be a dot on the map, right? And additionally, community. The community in Georgia is not only business-friendly, but we have focused on rural development. That has become a big part of our strategic advantage down there. We have what we call the front-door approach. We don't backchannel anything through any city councils, anything that. We show up. We meet the city. We shake their hands. We employ their people. We don't bring trades from anywhere else. We employ local contractors when we build, and we do it the right way. We're conscious of our impact on the communities. That community relation we have has been an immense advantage for us, and it's also had an immense impact on the community, where we're able to increase city budgets to large degrees, build parks and streets, and everywhere that our tax dollars go. that is all a really important part of why Georgia we chose to make home. And again, from a headline point of view, you're not reading about the complaints coming out of Georgia because we're the miner in Georgia, and we're behaving responsibly. Can you talk about your recent expansion into Mississippi and the facilities you acquired there? Really, if you could just talk about what attracted you to the state, how you're thinking about future expansion as it relates to geography. Absolutely. So in that area, it was kind of an obvious move because the main utility there is parent company, Southern Company, the same parent company for Georgia Power. They run on a very similar system. It actually has a few programs that have some advantages to it. And also, again, there's still a few utilities to operate in. But it was another state that was largely overlooked. So instead of being a crowded state where, you know, it feels like there's a Bitcoin miner, you know, wherever you throw a stone, like Texas, I think, is starting to fail for some people, right? We wanted to go to a place where we could be the face of Bitcoin mining, where we could be part of the community, where we could have relationships, where we would be appreciated. Because what I will say is, you know, a Bitcoin mine doesn't belong everywhere. Nobody wants a Bitcoin mine to, you know, pop up in their backyard in the middle of an already busy city, right? Ideally, Bitcoin mines are built, and they're just like they should largely exist in rural communities. Where better to go find rural communities than the, you know, American South? And again, we went into an area that we knew was gonna welcome us with open arms, in an area where we understood, you know, how the utility structured. Now, our entry point was acquiring three facilities that were owned by another party that had a fixed-rate power agreement already in place, fixed-rate power agreement, which was good but not great. But it established a foothold as part of our portfolio as a really important piece of the portfolio now, right? We are at floating open markets in Georgia, and we have incredibly low prices, you know, 9.5 days out of every 10, right, where, you know, just a few hours a year drops us into really advantageous rates. Well, now we have a fixed price over here that's kind of in the middle of the road, vanilla, and it can be a good anchor point. We will likely in Mississippi, as we expand, which we will certainly expand, but we will likely look to floating-rate programs there also to where instead of doing a fixed rate, we will look to basically take the market, do what we do best, which is, you know, participate in those power programs to run when it makes the most sense to run and not run when it makes sense not to run and outperform what effectively is an energy hedge. That's really all a fixed-rate agreement is, is the power party has taken a hedge or a fixed rate with the generator, and they're providing it regardless of their cost, right? So, there's basically hedges. There's fixed rates. And then there's the floating rates. We perform really, really well on floating rates, and that's like what we're gonna pursue. We're, you know, just over 40 megawatts in Mississippi, and we think that there's several hundred megawatts of expansion that can be done in the right place at the right time in Mississippi. So, we see this as this was for us to get a foothold in a state that we think is gonna be it has really strong growth prospects in the future. That's great. That's great. And staying on the topic of expansion, Zach, you mentioned on your last earnings call that you expect to exceed 17x a hash by April and to achieve 20x a hash, by June or call it the first half of this year versus 16, online today. Is CleanSpark still on track to achieve these targets? Absolutely. You know, we just had an announcement, you know, where we let everybody know that really the second week of April, we're gonna have another facility come online. That power should be the difference between where we're at today and 17. So, we said April 12th, I believe, in the social media post. We're tracking to be on that day or better, which is what's exciting. So, that should really be our threshold day for 17. You know, we expect to have another 50 megawatts still come online in Sandersville sometime next quarter. And, you know, we have a few other things happening, including we're building another 15 megawatts in Dalton. This has all been previously disclosed. All those pieces together get us over 20. So, those timelines remain well intact for 17 next month, 20 by the end of June. And we're, you know, looking to continue to push beyond it. We're pretty excited about the prospects ahead of us. As a segue to that, you know, looking beyond the 20 exahash, CleanSpark has locked in one of the largest purchase orders with Bitmain that we've seen to date. And for those on the call, Bitmain is one of the largest manufacturers of the ASICs for the mining equipment that CleanSpark and other miners are deploying, at their facilities. And the contract is such that you can acquire up to 32 exahash of S21s, which is their latest model miner, at just $16 a terahash, among the lowest costs or pricing we've seen so far for those pieces of equipment. Based on your comments from the call in February, it sounds like you're confident you'll exercise the full order by the end of this year, which, if you were to do that, would effectively lift total capacity to over 50 exahash per second. So, for the investors on the call, you know, how should they think about growth beyond again that 20 exahash as we look beyond the first half of 2024? Our expectation and what we've communicated is that we will absolutely be growing. We expect to exercise the option on that, which was another 100,000 machines that would push us up towards 50 exahash. The only thing we haven't given guidance on is time. But we are incredibly confident that we will reach those points. What we're excited about and maybe to talk a little bit of strategy on this, and again, I'm speaking kind of broad strokes, again, no timing on this. M&A, we're very excited about the prospects. We say this every time we're on a call, but I'm gonna continue to say it because halving provides a very unique opportunity. Weaker players who have inefficient fleets and don't have capital to do a refresh of machines, they still have a great facility. It's an excellent opportunity to buy a data center and bring in the fleet that we just purchased and plug it in. We're already seeing those players. You know, there's lots of, you know, offerings going on right now. There's lots of processes being run. And there's lots of private discussions, you know, happening. The market's abuzz with M&A activity. So, it's just a matter of we want to take the very best opportunities, add them to our portfolio, and that's gonna be our what I will call our near and medium-term growth is gonna be M&A-based, and we're confident that we will execute on that on a timeline that's beneficial for everybody. Beyond that, we're very excited to continue what we've always done, which is Greenfield project building. What I mentioned in Mississippi, we don't have anything, you know, currently penciled out and unsolidified, but we're excited about the growth prospects in Mississippi. We're gonna, you know, end up acquiring someone that will also have growth prospects, I'm sure, right? That just normally comes with a Bitcoin mine. Most Bitcoin mines, when they set it up, they set up there, you know, let's say it's 20 MW. There's usually an expansion opportunity. Those are the opportunities we're looking for. We don't just wanna buy a facility. We wanna buy facilities. We wanna buy pipelines. These are the things that we're focused on, and that's how we get to 50x a hash. So no, we don't have all the infrastructure to get to 50x a hash today. But if you look at our historical track record, we've acquired facilities. We fill them with machines. What you have is you have this interesting thing that happens in the Bitcoin space. They're either long machines where you have machines that are coming at some point in the next several months. You go find a home for it, or you're long plugs and you're short machines. Right now, we're long machines, and we think that that was the right choice for this time in the market. We have, you know, 20,000 S21s landing in April, May, and June. And then, as I said, you know, when we exercise the option for the next 100,000, those will come then shortly after in the second half of this year and early 2025. We wanna be long machines because the opportunities for data centers seem to be so hot right now that we believe we'll have no problem filling that up. So, we're really excited about, you know, the next several quarters. Halving's gonna be exciting for us. We're glad we're positioned for it to be exciting instead of the other way around. You know, to just kind of add to that, Mike, last cycle, the machines were the real variable, right? There are a lot of variables in space, power costs, global hash rate, the price of Bitcoin, but really what it was was the price of the rigs. So, at the beginning of the cycle, when Zach mentioned we started to sell our HODL, you know, the 900-pound gorillas in the room, Marathon, Riot, they each committed to buy $1 billion worth of the XP machines. And they, you know, they were paying $80-$100 a terahash initially. And so that created supply shock for us. So, as the smaller guy, the last kid on the bus, like Zach likes to say, you know, we were forced to look at how do we bridge that gap? And so we have a very unique perspective in that we bought machines when it made sense. We bought all different manufacturers of machines, and we ran them, and we tested them out of need. So, the purchase that we made of the Bitmain machines isn't because it was the best price or there was a promotion on Pizza Day or whatever the case may be. It's because we have familiarity with literally every manufacturer of ASICs on the planet, and we made this decision by choice. It's like Southwest Airlines, right? We'll fly anything as long as it's a 737. We feel that level of commitment right now with Bitmain because we have the familiarity with operations, with warranty, with installation, but then with technology also. So, that's another really exciting point. So back then, when there were $2 billion worth of machines committed, what I think a lot of people looked past is that's gonna drive difficulty up, which squeezes margins. And then we ran, you know, put on our energy guy hat, and we ran modeling about where the price of energy goes. And you look at some of those future models, and this predated the war in Ukraine. So, not even including that, we're seeing difficulty going up by virtue of the massive rig purchases. We're seeing significant volatility and a very peaky nature in the cycle of the price of the underlying commodity. We're seeing a bunch of variables that we can't control. So, that was when we made the decision that we're gonna sell this HODL. We're gonna buy the immersion equipment and the transformers and the switchgear and the power supply units, and we're gonna prepare ourselves. And so something that's different that I think, you know, maybe is worth talking about. Companies were paying earlier in the cycle $70, $80, $90 per terahash for machines, and they are now depreciating those over 3-5 years. We went into the market and bought those same machines in the $20s and $10s, and we've accelerated depreciation on anything that wasn't as efficient. So, what that really speaks to, Mike, is we've tried to maintain balance sheet strength so we can demonstrate to our investors that have entrusted us with their capital that we're forward-thinking and we're being aggressive on all fronts, not just the machines, not hosting agreements, not just infrastructure, not just technology, but we try and take a balanced approach. What we've done is surround ourselves with people significantly smarter than we are in their individual areas of expertise to kind of shore up any weaknesses that we have on our team. So, all of those components and then the people are really what the engine is. So here at the bank, we cover about 95% or so of the total, publicly traded mining landscape of, call it, 20 miners. And what we'd say is CleanSpark is one of the, if not the best positioned miners heading into this halving event, which is now 25 days away, when we get to the 840,000th block, on the Bitcoin blockchain. It's a very hyped-up event right now. Once every four years, this occurs, on the Bitcoin network. And, Zach and Matt, you touched on some of the things you've done to prepare for it. If you could just share your expectations around the potential for, Bitcoin price action, where we should go directionally, you know, after the halving event. I know it's a hot topic right now in the media. And then also your expectations for the network hash rate. We know there's some weaker miners out there that may have to unplug, so any sort of views you have on that, and then you also talked about some acquisition opportunities that could potentially get more interesting after the event in April, which, again, is 25 days away. Just curious if you could provide some more color on the pipeline there. Yeah. So, you know, I'm gonna try and hit all those points, and I'm just looking at the time too. So, I'm gonna try and keep some of these answers a little abbreviated. Let's talk Bitcoin price. Where do I think it's gonna go? I'm gonna be really short and sweet with it. I think it's gonna go up because I think that the supply shock that's already being felt on the ETFs will just get, you know, bigger. You know, the ETFs, it's kind of interesting if you watch how it trades. You know, the volume leading up on a Sunday is the, you know, certain overseas markets, you know, open up and move into, you know, the weekend because of the T+2 trading and T+1, depending on which ETF it is. There's just a massive amount of capital still flowing in. And again, they're all looking to gobble up Bitcoin, which is disappearing off exchanges at record rates and things like that because it's going to these ETFs and getting parked on a shelf, effectively. So Bitcoin is simple, and that's what's great about it. It's really a exercise of economics, supply and demand, right? Do I think the supply shock will be felt immediately the day halving happens? No, but it will be over an extended period of time. It's the same way that, you know, the ETFs launched and everybody said, "Wait a minute. How come Bitcoin didn't go up?" It actually went the opposite direction. It took a few weeks for all these ETFs to gear up and get the cash moving and, you know, everything to go with that. It's gonna be the same thing. Supply shock will be felt. It'll go up. Acquisition opportunities, let's just say there's a lot. There are right now hundreds of megawatts of conversations happening, and that's just in the U.S. discussions that we're aware of. And I will tell you, we're not interested in HATL because it was, you know, a weak miner in the wrong power spot, you know. And there's places that won't be good for mining anymore, even with the most efficient rigs and a $70,000 Bitcoin price. We're gonna have to unplug, which leads into the, you know, the difficulty side. And I'm just gonna give you, like, an example. Canada. Right now, there are certain areas in Canada, not all areas, just certain pockets where miners exist today. It will not make sense to mine there, no matter what rig you have, in 25 days because, you know, difficulty would have to drop off the face of the planet in order to compensate for the high-power prices that are now being pushed across in jurisdictions, due to how the markets are structured. So, on the difficulty side, if you'd asked me a month ago, maybe 45 days ago, I would have said a 30% drop was a sure thing post-halving. Bitcoin has moved from, you know, high 40s all the way to 70 now. I think that drop in difficulty is probably, you know, 7%-15% now. And it probably recovers 100 days afterwards as new hash rate comes online. So, if you extend that over a 100-day period, I'd say the drop in difficulty is gonna be temporary and largely flat before it starts to build again. Now, if Bitcoin, you know, takes a retrace or anything like that, my answer would change. So that's that's the really interesting thing about making sure you view this day by day is the dynamics can be measured real-time when it comes to difficulty, Bitcoin price, you know, hash rate, all of those things are all available in public. And, you know, the market moves real-time. So, it's it's great. And we're we're gonna keep watching up to the day up. What I can say is even if difficulty was to go up on halving and never dropped, we're well-positioned to handle it because, again, we are building for the next four-year cycle. So, we're not really worried about it on our side. Instead, we're just anticipating the opportunity. So, whatever drop-in hash rate it is, that goes to our bottom line. You know, Mike, just one quick point to that, as we lead into halving. For the members of your audience that aren't super familiar with the way that Bitcoin mining works, there are all different types of machines, just like there are all different types of cars on the road. And at the end of the last cycle, the average machine consumed about 38 watts to process one terahash of data. We don't have transparency into what the global network looks like, but it's theorized that it's on the plus side of 30 watts or 30 joules per terahash. So, our fleet right now is in the low to mid-20s per terahash, and that will drop with these new machines coming in. So, what that means is for the same amount of power, we can mine 50% more Bitcoin than the average of the global fleet, assuming it's in that 30 J/TH range. So, when you look at what Zach said when we talk about M&A, there are many companies, many miners that have built really top-quality infrastructure. They've got, you know, copper-based wire rather than aluminum. They've got good transformers and switchgear, but their fleet of machines may not have the efficiency profile that the unit economics would work post-halving unless Bitcoin goes to $100. So, we're positioned well with the optionality of these machines that when we find the right one, and as Zach mentioned, there are probably two dozen on our board right now in some stage of due diligence that when we execute on M&A on facility side, we'll find a place to go with the machines that are there. There's, you know, an active secondary market. A lot of private equity guys are trying to get in the space, but we'll repopulate that thing immediately with the most efficient, fastest, best machines on the planet, maintaining our lead and even building that as far as efficiency goes. So, it really comes down to being able to get squeeze more juice out of the lemon. A very important metric as we head into the halving, for sure, as we look at the fleet efficiency there, Matt. Looking at operational efficiency now, so CleanSpark is consistently at the top of the charts as it relates to maintaining one of the highest realized hash rates in the industry, meaning that your Bitcoin production closely tracks your operational and deployed hash rate. What's CleanSpark's secret sauce? How are you guys able to really sustain such high levels of uptime? Matt, I know you touched on this a bit before but love to get more color here. Yeah. So, you know, I think it starts with the fact that we're aligned with our team. You know, everybody's a shareholder. Everybody's pulling the same direction. And, you know, there you know, just some fun little anecdotal things that, you know, our sites have site managers, and then there are teams of team leads within the site. And there are incentives, you know, whether it's, you know, a T-shirt and a hat or whatever the case may be, there are incentives for this uptime performance, which it stimulates this competitiveness. But it creates this opportunity for collaboration. So, Taylor leads a call. Taylor and Brad lead a call every Tuesday that we, or excuse me, every Monday. And it's our ops call. And the site leads get on the call, and they talk about what's working for them, new mechanisms for changing filters, new efficiencies, and whatever the case may be. So while Zach is busy acquiring the best machines at the best price, and Taylor and Brad and Zach collaborate on time of use and using our technology to accelerate when prices of energy are low and Bitcoin is high, or to decelerate and underclock those if temperatures go a little higher. But we have this technology stack at our disposal. But then at the very kind of core level of our company, it's the frontline guys, the miners, the ones that operate the machines. And we have developed kind of a culture. You mentioned it in the beginning of your remarks, and you've been to many of our facilities to see that. But we've developed a culture where the people that work there, yes, they're shareholders, but they're owners, and they care about the facility. And you walk through, and, you know, the wrapper off a water bottle is laying on the ground. And I'm following a mining technician who bends over and picks up the wrapper and puts it in his pocket as we're walking through the site. How do you create that culture? Well, the thought process for that guy is if that gets sucked into the fan and it's on my team, my efficiency may go from 99.8%-99.7%, and that may cost me the win for the month. So, we've created this culture that they have pride of ownership in what they do. And that's our team members, top to bottom. But they're also owners. So, everybody pulls the same direction for the benefit of the greater good. And when you have the executive team executing at that high level, providing the best equipment, the best repair facility, the best power prices, and then you've got, you know, guys like Scott Garrison that are out building facilities that, you know, we can build faster, that are more efficient than most anything available on the market. So, it's all of these relationships. And then you plug into a little community like what we've done. And gosh, there was a story on the Atlanta TV station with the economic development director in Sandersville saying that the margin, so we buy power from the city at cost, and then we let them make a margin or they charge us a small margin on every kilowatt hour. So, that that money is earmarked to go into, like Zach mentioned, schools and roads and parks and libraries. But then in the state of Georgia, you pay sales tax on utilities. And part of the Territorial Act is the sales tax stays in the jurisdiction that it was generated. So, those sales tax, they're now using to cover all other kinds of their budget. But the city manager, Judy McCorkle, said on a call on an interview on TV that that surplus sales tax is now pushing down property tax and pushing down utility rates for the ratepayers in the community. So, now we're faced with city managers and mayors and city council people reaching out to us saying, "Hey, we've got great teams. We've got great power. We've got a big desire for you guys to be here. What do we have to do to invite you to come to our community?" That, my friend, is the biggest accomplishment that the CleanSpark team has made. That is the front door policy, Zach said. People love to have us there. They love to work with us, and they love to work for us rather than, you know, grab your torch and pitchfork and run the Bitcoin miner out of town. I'm gonna add one more thing, Mike. The thing that we champion the most, and it's, I call it the, you know, our top core value is grit. You know, it's not just rolling up your sleeves and doing the hard work, but it's about caring and to the point of kind of giving a damn, right? And a key thing with this, you know, and everybody I think has heard of the book Angela Duckworth wrote called Grit, great study on grit and how to create gritty teams, studies Olympians, and so forth. But the number one thing to build gritty teams is to already have a gritty team to start with. So, if you start with a gritty team of two and you add more to it, people will naturally behave like their peers. We make sure that every single person in this company is gritty and cares. So, they're willing to work hard, and they're willing to push that extra mile in whatever they do because that's the CleanSpark way. So, you know, you pair that in with rural communities, and that's kind of where Matt was driving. It's pretty easy to find that grit in those communities, and we really incorporate it directly into our culture top to bottom. That's great. That's great. Really strong culture there. And as I mentioned, Georgia facilities out in Georgia. Everyone is highly engaged and really just happy to be there and contribute to the broader organization. So, as the investors on the call can see, very, very strong culture here at CleanSpark. Switching gears over to power costs. So, power costs are very critical in maintaining, you know, profitability for a Bitcoin mining operation over time. You paid just under $0.045 to power your facilities in Georgia this most recent quarter and also locked in a 5-year PPA in Mississippi for $0.05. So, as we look out through the rest of 2024 and beyond, how should investors think about CleanSpark's blended average power costs? At some point in the future, Matt and Zach, would you see yourself potentially hedging power in Georgia? I know you're going floating now and trying to time the market, but any color there would be helpful. Yeah. So, my answer, in a couple different ways. So, the power costs in Georgia are, you know, better quarter by quarter, actually. So right now, you know, if anybody pays attention on this call to kind of where natural gas surplus is and things like that, every all power generally indexes to natural gas. And then it comes down to, on a regional basis, whether you have abundant power and what the sources are. In Georgia, a lot of the power comes from nuclear power, which is what drew us to the state in the first place. You have a base load that always wants to get used. And when it's not getting used, that drives power prices very low. So, we've seen, for example, on an hour-by-hour basis, as I mentioned, we buy power in. You know, power is, you know, consistently in the month of March, was in the $0.01+ range, right? And then there were other hours that were, you know, $0.03 and $0.04. I expect, and if you look at last year to give an example, that really this the shoulder seasons have proven to be very strong for us. We're in one right now. We expect these power prices to continue to be very strong and very low. So I I I frankly expect, you know, this quarter and next quarter to probably be our, you know, better power prices than we've had the last few quarters. And so just from a trajectory point of view, really happy in general. To your next question about hedging power prices to lock it in, we have consistently so every single month, we have an opportunity to buy a hedge. We can buy as much power of our power portfolio to hedge. But then what we do is we if we pass on that, which we historically have done, we basically set a target that we are going to see how we can produce to out basically outperform the hedges made available to us. And 12 out of the last 12 months, we have outperformed the power hedges that were offered up, meaning if the power hedge was offered at $0.039, right, we want to come in that price or better. So, you know, you point to the $0.044 average. The power hedges offered during that quarter were above that price on a month-to-month basis. So, we beat the power hedge. Because you got to remember, power hedges are being sold by a variety of financial parties, generators, utilities, so forth. There's a bunch of people in the background that are trying to lock in certainty will still make up, right? And the reason they're willing to lock that in is they're trying to play the middle of the road. They're like, "Hey, if things go really good for a generator, which means, you know, power prices spike, they're going to get more revenue. But if power prices drop, they're going to get less revenue, and they may or may not cover their operational costs," right? So, you need to know whenever a hedge gets put in place, that's generally representing a middle-of-the-road opportunity. And so we try and outperform it. Do I think we will hedge our power at some point this year? I do. But I do think when we do, it will be a portion of the power. Because as much as we've been outperforming power on a historical basis, you know, for the last several years, you always want to be protected against kind of outsized events. So, because our portfolio has gotten so big, it's just sound management to start to hedge portions of it. But I don't think we will ever hedge all of it unless that middle-of-the-road opportunity was just so good we couldn't turn it down. And with the energy markets being as dynamic as they are, that's not something we're going to anticipate for. And secondly, a power hedge always requires a financial commitment, which usually means you take cash or other assets, and you put it in as custody that can be pay that hedge. That keeps the capital on our side of the wall. And we're using it to build instead of just locking a power rate because we're looking at that on a cost-to-capital point of view. If our, you know, if we can go out and we can build a site and generate, you know, revenue that results in millions of dollars more revenue in a single month, we'd rather do that than save an extra $100,000 on the power bill. So, I know it's a long-winded answer on it, but the point is it's we're very thoughtful. We do things for a reason, and there's a reason we haven't done it yet. Now, looking at mining infrastructure, most of your data centers right now are air-cooled, with the exception of about 20 MW or so deployed at your Norcross facility in Georgia that uses immersion. What observations have you made as it relates to cost differences and performance differences of air-cooled versus immersion? And, would you consider using immersion for future data center locations? We see different miners taking different approaches to this, so we'd love to hear your views. Yeah. We're going to take the right approach for the right places. And there's absolutely places where immersion makes more sense. You know, Matt mentioned Taylor Monnig, our senior vice president of mining. He really, right, you know, keeps everything online and running on the mining side. He has several patents in both single and dual-phase immersion. So he used to, you know, be a founder of a company that built those. So we are probably more versed in a background in education, as Matt mentioned, finding experts that are experts at the best things in that. And the fact that we're building air-cooled in certain places, what we're looking for is ROI. So we know all the benefits that immersion can bring. But if you, for example, have to spend, you know, more money on something, we're looking at the time it takes to hash that back. So anything that's $100 more, right, in total cost, it, you know, current mining, it may take 7-10 days to earn that $100 back from a single miner, let's say, right? So we measure everything that way. Two-phase, for example. It's something that's being talked about a lot. One of the reasons it doesn't make any sense is because the fluid is so expensive that sometimes the payback on that is never before you have to, you know, change your fluid, adjust it, do things, you know, whatever it may be. Also, there's so much R&D that goes into it. You're going to notice that we are not releasing a bunch of headlines to talk about R&D projects and side projects. We do one thing, and we do one thing really, really well. And that's mining. We have owned manufacturers. We own a switchgear manufacturer. We don't anymore. And we sold the business with the energy company years ago because, one, there's more margin in Bitcoin mining, but it takes a lot of expertise to run that, and margins are thin. So why would we own a switchgear company? Why would we manufacture our own tanks when there's experts that make immersion tanks, right? So point being is I kind of work backwards through this. We know air. We build air. We also can build immersion. When we do build immersion, it's a single-phase immersion because it's the most cost-effective. And so I'm driving to a point here, which is cost. When we built our immersion site, we wanted it to be big enough to experience a real deployment, 20 MW. It's not small. But it also what we weren't going to bet the farm on 150 MW of immersion. We wanted to learn and experience in a real-time way. We've now run that site for well over a year, and we've learned a lot from it. Only now have costs adjusted to where we can now go out with our connections and our vendors. We can build an immersion facility for about the same cost as an air-cooled facility, which means now we get to measure not just on the build cost ROI, but now what does it do for the miners? We can get great performance out of air-cooled miners. We can get slightly better performance out of the immersion miners, 15%-30% better. Anything beyond that, you start to lose efficiency, which means we're not making as much money. And so that's what we pay attention to first as a strategic point. So, now we're looking at this in a new way. Now, as we launch into 2024, I do think that we will build more immersion. But I am not going to say that every site we're going to build is going to be immersion. I just think that we're going to build a lot more immersion. I think that there's still going to be great opportunities for air-cooled. There's going to be great opportunities for immersion. For example, though, it's also a lot quieter. There are pockets in places that we've looked at we haven't built because nobody, again, wants a noisy Bitcoin miner, you know, too close to anything. Our immersion facility sits in the middle of a community. And there are, you know, houses across the parking lot from our facility. It's incredibly quiet. You don't know we're there and we're Bitcoin mining based on the reputation of it being noisy. That is a perfect example of why to use immersion cooling over air-cooled. And then the other thing is, again, the miners last longer. So, as we're bringing in this new fleet of machines that we think has an extremely long shelf life into the next halving, that's a great time to take those brand new miners that are going to you want to put in a tank and leave them there for three or four years, you build an immersion facility. So, all of those reasons together, yes, you're going to see us build more immersion in the coming year, but we are going to walk, not run into it even with a because of our expertise on this, knowing you have to get it right or you can spend a whole lot of money, and it'll never pay back. That's great. Really really insightful on the immersion side. And Matt, I recall last time, you know, I was down to your Norcross facility. There were several analysts. I was not one of them doing samples of your immersion fluid out there. So, although it looked like Mountain Dew and it's a nice, tasty soda, I did not partake in that. So, it'd be interesting to see what you guys do next. Philip, so just really quick on that point, Mike, that the fluid in single-phase immersion that we use is, it's effectively mineral oil. Okay? It's, it's not an environmental contaminant. It's biodegradable. It has no legacy that you have to worry about. The current fluid available on dual phase, not only is it north of $300 a gallon, but under certain circumstances, pressure and temperature, it can convert to the same chemical element as mustard gas. So, when we look at and evaluate these opportunities, first and foremost, you have to think about the safety of the people operating that and then the surrounding communities. So, you know, to your point, I think you were there. Dan Weiskopf from the BLOK ETF, you know, put his finger in the fluid and tasted it and posted it on Twitter. You know, you probably shouldn't do that, but you can. But that's just evidence or proof positive that, you know, there are a lot of benefits to single-phase immersion. And that's why we've chosen to kind of balance that approach. Yeah. That's great. And Dan, if you're on the call, hope all is well on your end. And, the mineral oils, did well for you. So, you know, switching gears now, I want to talk about CleanSpark's treasury strategy. I mean, you guys have had one of the most dynamic Bitcoin treasury strategies of any of the public miners. And you've historically done a great job at timing the market. Zach, you talked a little bit about this earlier. And over the past few months, I've noticed that you've held on to most of the coins you've mined. So, my question is, why the pivot, and what could investors expect to see as it relates to your HODL strategy in a post-halving environment? You should expect it to continue to be dynamic. Although I do expect for the foreseeable future, we are going to be adding Bitcoin to the balance sheet. But we're adding Bitcoin to the balance sheet right now because we have a belief and an expectation that on a, you know, short to medium-term basis, it's going to continue to go up. I think on a long-term basis, it's a straight line, right? If you measure it over over over 10 years, it's got nowhere to go but up. With that said, though, there's going to be opportunities to monetize the Bitcoin and to during downturns, bear markets, things like that, and then to essentially reinvest all those dollars into getting more Bitcoin. That was our adage, actually, during the time period that we were selling Bitcoin. It was use Bitcoin to get more Bitcoin, right? Now, right now, we believe we're doing the same thing, but it makes sense to hold the Bitcoin until the right time and the place and the value goes up, right? Because, you know, we're currently mining Bitcoin for sub $20,000 on a direct cost basis when you look at power costs and things like that as our direct input. And then we're turning around, and it's all up to $70,000. So sure, Bitcoin was $45,000 in, you know, January, February. And here we are today. That means we kept all that value, and we built it. When we see the tides shift and again, Bitcoin has proven to be cyclical. Usually, in every four-year cycle, it's kind of a split two-year up, two-year down, bear bull. When we see the tides turn, we would sell our Bitcoin, turn it back into cash, and restart the process. Now, with ETFs, I think those cycles are going to be a little different. And so they may happen sooner. They may happen later, you know, all depending on all those factors. But again, I'm going to go back to what I said all the way at the beginning. We look at this as today is today. We're going to measure it real-time. And so we will continue to make our decisions on Bitcoin on a real-time basis. But I will reiterate, currently, right now, we see no reason why we would change direction. And we want to continue to add nearly all the Bitcoin to our balance sheet that we produce. Looking at infrastructure-related costs to support incremental expansion from here, you guys have really laid the foundation by locking in the $16 of terahash for the S21s to get you to the 50. But really, on the infrastructure side, how should investors think about that capital expense, going forward? You know, I think the way to think about it is we want to deploy capital largely in the M&A in the near term. And the benefit to the M&A side is you with the machines, again, since we're going to be long machines, we'll almost immediately plug in machines and produce cash flow from that. And and so right now in that market, you know, acquisition costs can be in the, you know, $500,000-$600,000 range per megawatt, for a quality site. Whereas when we're building sites, which we do and we will continue to do, that capital cost can be in the high $300,000 range for, again, a quality site, right? And so there's a big delta. But the difference in that delta is timing of the return of that capital. So, when we build, we want to keep it under, you know, or I'll call it in the $400,000 range, right? All in getting it built. And we're willing to save a bunch of money on that. We're willing to pay up a little bit when it comes to, I can plug a machine in tomorrow because it pays for itself that delta, right? So, really the way to think about it is it's, I guess that, you know, it's going to be in the 500+ range for things we acquire, but they're going to turn on right away. And when we build, we're going to try and keep it around that $400,000 mark because we build facilities that are going to be here in 10 years. We don't just buy a pod that we're going to have to buy a new pod in three years. We don't treat our data centers as disposable. And I think that's the key takeaway in that too is we're not going to look at maintenance cost over, you know, 10, 12, 15 years instead of replacement cost under a much shorter time period that many of our peers look at. You know, Duncan and Scott and Tyler and Taylor spent a ton of time on airplanes looking at opportunities. There have been a ton of sites for sale you've seen in the news. You know, some of those have been picked up. You know, we're looking at sites that fit the CleanSpark way. It's little things that you wouldn't think about, but like running the power cables from the transformer to the racks using aluminum can save you money, 50% less than using copper, but it doesn't dissipate heat as well, which causes system failures. So, when you look at CleanSpark's uptime, we talked last earnings call 99%. You look at the rest of the industry, and what you can see there is the direct impact of vertical integration and quality infrastructure. You put that out to hosting, or you build maybe for budget rather than for the long term, and you're going to see an immediate direct impact on that efficiency. So when he talks about a quality-built site, it comes down to what's inside the wire casing that leads a go-no-go decision even in some instances. That's great. That's great. I think we're running up on time here. But guys, this has been tremendously helpful, really, really interesting conversation. Matt and Zach, really appreciate your time. If you had any sort of last-minute comments you want to throw out there to the investors on the call, you know, by all means. If not, we can go ahead and wrap up the event here. You know, I'm going to say something that I think is just interesting from a viewpoint that I guess I would share. You know, four years ago when we started this, we started preparing for Halving. We were not; we actually said, "We want to be amongst the top four or five." We actually set our goal. We set it publicly. We amongst the top five. Internally, what we said is we weren't going to be the biggest to be the biggest. We weren't going to be any one thing to be it, but we were going to be the very best Bitcoin miner. And I think we're at a key inflection point where we are there, and we're going to continue to fight to stay there. So, you know, I'm excited for Halving. I think we're incredibly well prepared. You know, I think that the good fight that's been fought by our teams and our people over the last four years has positioned us incredibly well for the next four years. Thanks to you for making us your top pick. We, we endeavor to make you look smart. You guys have been doing just that. And, appreciate it. So, it's definitely been great to see the ride here as you guys have really worked up to 16x hash, which is truly remarkable being in the top percentile now of all public miners. And, appreciate everyone on the call today. Guys, great conversation. And, Zach, perfect way to close out the call. So, you know, all the best and continue success with the deployment of future expansion here. I appreciate it. Thank you, Mike. Thanks, Mike. Okay. Take care. Take care.