Bitfarms and Riot Platforms Resolve Lengthy Dispute with Settlement Agreement

The public dispute between Toronto-based Bitcoin mining company Bitfarms and its investor and competitor, Riot Platforms, is nearing resolution with the announcement of a settlement agreement that involves significant changes to Bitfarms' board. This development marks a critical turning point for both companies, allowing them to refocus on their operations and strategic goals.

As part of the settlement, which has been officially filed with the United States Securities and Exchange Commission, director Andrés Finkielsztain has resigned from Bitfarms' board. In his place, Amy Freedman has been appointed to serve on the board, as well as on its governance, nominating, and compensation committees. This change is intended to bring fresh perspectives to the company's leadership and governance.

Riot Platforms, which is the largest shareholder in Bitfarms, has agreed to withdraw its requisition from June that sought a vote to reconstitute Bitfarms' board. In a gesture of goodwill, Riot has committed to abstaining from any actions that could disrupt or challenge Bitfarms' control or operations until at least the company’s 2026 annual meeting. These arrangements are characterized by Bitfarms as "customary standstill provisions," aimed at stabilizing the situation.

In a statement, Riot CEO Jason Les expressed optimism about the settlement, emphasizing its importance for enhancing shareholder value at both companies. He stated, “As Bitfarms’ largest shareholder, we look forward to supporting a reconstituted Bitfarms board and continued engagement with management.” This indicates a collaborative approach moving forward, aimed at strengthening the business relationship between the two firms.

Bitfarms has announced that its special meeting of shareholders, originally scheduled for October 29, will now take place by November 20 at the latest. During this meeting, shareholders will vote on several key changes: expanding the board from five to six members, electing an independent director nominated by the board, and ratifying Bitfarms' shareholder rights plan. Riot has committed to voting in favor of these proposals, which is a significant endorsement of the changes being made.

Additionally, as part of the settlement terms, Riot has secured the right to purchase additional shares of Bitfarms, provided it maintains ownership of at least 15 percent of the company’s total outstanding common shares. This arrangement could potentially strengthen Riot’s position within Bitfarms while also supporting the latter's growth initiatives.

Bitfarms' CEO, Ben Gagnon, expressed satisfaction with reaching this agreement and emphasized the company's focus on executing its growth strategy. He highlighted plans to diversify the business beyond Bitcoin mining into new areas such as energy generation, energy trading, heat recycling, and other high-value revenue streams. This shift reflects a broader trend in the cryptocurrency sector, where companies are increasingly looking for sustainable business models amid fluctuating market conditions.

Founded in 2017, Bitfarms operates Bitcoin mining farms and provides computing power to cryptocurrency networks. The company is publicly traded on the Toronto Stock Exchange and Nasdaq under the symbol “BITF.” Riot Platforms, based in Colorado, has emerged as a significant player in the Bitcoin mining space and is currently the largest shareholder of Bitfarms.

The settlement follows nearly six months of public disputes, which began earlier this year when Riot revealed that Bitfarms had declined its $950 million USD offer to acquire the company. This rejection led to Riot publicly questioning Bitfarms' leadership and gradually increasing its stake in the company, prompting Bitfarms to implement various ‘poison pill’ strategies via shareholder rights plans in an attempt to thwart Riot's potential takeover ambitions. The resolution of these tensions paves the way for both companies to concentrate on their respective growth trajectories without the distractions of ongoing conflict.