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Friday, May 20, 2022

The9 [NASDAQ: NCTY] Ink Term Sheet with KazDigital to Build a Cryptocurrency Mining Site

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The9 Limited [NASDAQ: NCTY] disclosed that its fully-owned unit NBTC Limited and Kazakhstan enterprise KazDigital Ltd have inked a non-binding term sheet.  NBTC and KazDigital both have planned the creation of a joint venture firm in Kazakhstan to develop a cryptocurrency mining site with a capacity of 100MW.

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As per the Term Sheet, the two sides will provide their own assets to build the joint venture. KazDigital will spend assets associated with the building and infrastructure of the mining site into the joint venture, and The9 will spend cash or mining machines in the joint venture.

Financing Details

Furthermore, it has been disclosed that the assets financed by both the firms will be examined by a third-party independent institution in order to verify their reasonable value and to guarantee that both sides devote equal assets. It has been disclosed that the new mining site will be used to implement The9’s mining machines and possibly the mining machines of other third parties.

Additionally, after the creation of the joint venture, the building of the total capacity of the crypto mining site will be executed in four-stage. The initial phase of 25MW has been executed on August 1 this year. The left-behind 75MW will be steadily executed in the Q3 and Q4of this year and the Q1 of 2022, with a fitting of 25MW per quarter.

Moreover, KazDigital will be liable for future operation and management of the joint venture. It will also be accountable for presenting appropriate reports to The9. The9 will first dispatch 1,000 mining machines to Kazakhstan for prosecution operation to guarantee to simplify processes and operations in the future.

In addition to this, both firms are binding upon the 6 months exclusiveness period concerning the development of similar collaboration in Kazakhstan. However, this does not contain the right of The9 to search for other mining sites in Kazakhstan for hosting and co-location of its mining machines.

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