Several members of the Trump family have backed an ambitious new project that plans to become the world's largest bitcoin mining company.
On March 31, digital asset mining and infrastructure development company Hut 8 officially announced the acquisition of a majority stake in American Bitcoin (formerly known as American Data Center). This firm was founded by a group of investors, including the president's sons Donald Trump Jr. and Eric Trump.
Ambitious plans for the new venture
As part of the deal, American Bitcoin will take ownership of the bitcoin mining equipment owned by Hut 8. Donald Trump Jr. noted that the entrepreneurs behind American Data Centers have reaffirmed their confidence in bitcoin both personally and through their business entities.
According to an official statement, the new venture "aims to become the largest and most efficient pure-play bitcoin miner while building a robust strategic bitcoin reserve." The mining operations will remain under Hut 8's computing segment, but will be branded under the American Bitcoin brand.
"Mining bitcoin on favorable economic terms opens up even greater opportunities. We are excited to bring investors into the equation through a platform designed to realize this thesis and provide real, tangible participation in the growth of bitcoin," added Donald Trump Jr.
The Trump family is deepening its involvement in the cryptosphere
President Trump continues to push policies in favor of the cryptocurrency industry while his family and affiliated companies expand their presence in the digital asset sphere.
On March 28, he pardoned three co-founders of cryptocurrency exchange BitMEX who had previously pleaded guilty to federal money laundering charges, according to a CNBC report.
On March 21, the U.S. Treasury Department excluded decentralized cryptomixer Tornado Cash from sanctions lists, quashing related litigation. Additionally, the Securities and Exchange Commission's (SEC) Division of Corporate Finance recently declared that memcoins do not qualify as securities under U.S. law. Work is underway to create a national strategic bitcoin reserve.
The Trump family was involved in the launch of a decentralized finance protocol on Aave called World Liberty Financial (WLFI), as well as the introduction of a new stablecoin called USD1.
Hut 8 performance metrics
U.S. mining company Hut 8 announced the launch of a share repurchase program worth up to $500 million to acquire bitcoin as a strategic reserve.
The program to offer option contracts with an exercise price that is identical to the underlying market price (ATM) will allow the company to sell up to $500 million worth of common stock.The proceeds are expected to be used to develop energy and digital infrastructure, build a strategic reserve in bitcoin, and for other corporate purposes, including debt repayment.
"The launch of the ATM and share repurchase programs gives our business two powerful tools that strengthen our ability to operate in volatile markets," Hut 8 CEO Asher Genoot said in a statement released Dec. 4.
Under the capital management program, the company will be able to repurchase up to 4.68 million common shares, representing 5% of its total outstanding shares, over the next year.
"These tools support a robust integrated capital management strategy, reinforcing our proactive approach to financial management," Genuth added.
Shares of Hut 8 (HUT) fell to $6.33 in January following the publication of a shorts report that alarmed investors. Since then, however, their value has risen 326% to $27.03 as of Dec. 4, according to Google Finance.
This week, the company filed a motion to dismiss the shareholder class action lawsuit, claiming it is based solely on a traders' report aimed at manipulating the market.
Hut 8 has become yet another company investing in a bitcoin reserve strategy. Over the past month, educational AI company Genius Group, biopharmaceutical company Hoth Therapeutics, video sharing platform Rumble and Canadian company Jiva Technologies have all announced strategic bitcoin reserves.
