Bitcoin miner Bitfarms Ltd. has appointed Ben Gagnon, its Chief Mining Officer, as the new CEO, marking the fifth leadership change in as many years. This move comes as Bitfarms faces increasing pressure from Riot Platforms Inc., a former suitor.
Gagnon replaces interim CEO Nicolas Bonta, who stepped in after the company terminated Geoffrey Morphy in May. Morphy’s dismissal followed his lawsuit against Bitfarms, seeking $27 million for breach of contract.
On the same day as Gagnon’s appointment, Riot Platforms launched a website called “A Better Bitfarms,” criticizing Bitfarms’ corporate governance and CEO succession issues. Riot previously made an unsolicited $950 million offer to buy Bitfarms, which was rejected. In response to Riot’s increased stake in the company, Bitfarms adopted a poison pill defense to prevent a hostile takeover.
Riot’s website claims that Bitfarms’ board has failed to manage CEO succession adequately, indicating a need for change. Riot, now holding nearly 15% of Bitfarms, has nominated three candidates—John Delaney, Amy Freedman, and Ralph Goehring—for Bitfarms’ board. These nominees could replace current chairman Bonta, director Andrés Finkielsztain, and fill the vacancy left by co-founder Emiliano Grodzki.
The Bitcoin mining industry is consolidating as companies aim to increase market share amid shrinking profits. An April Bitcoin software update, known as “the halving,” has significantly reduced profit margins, contributing to an estimated $10 billion industrywide revenue reduction this year. Additionally, lower network fees and a recent drop in Bitcoin prices are squeezing miners further.
Bitcoin mining involves using specialized computers to validate transactions on the blockchain, earning a fixed amount of Bitcoin. Companies with more computing power have a higher chance of receiving rewards, driving them to scale up operations.
Since Riot’s acquisition attempt was revealed on May 28, Bitfarms’ share price has risen approximately 32% to $2.67. Meanwhile, Riot’s shares have decreased by about 9.4% to $9.40.
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