Asset management giant Fidelity increased its stake in Bitcoin mining company Hut to 10.6%

Recent regulatory filings show that asset management giant Fidelity holds about 10.6% of Hut 8, a Canadian-listed bitcoin mining company.

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On July 10, Hut 8 filed an alternative monthly report (AMR) with the Ontario Securities Commission, saying Fidelity owned its common stock and common Stock purchase warrants, totaling about 10.6%.

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According to AMR filings, Fidelity holds 8,396,138 common shares and 2,054,956 purchase warrants for common shares, so Fidelity is believed to hold 10,451,094 common shares, representing approximately 10.58% of the class outstanding.

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The AMR filing was disclosed because Hut sold shares in August in June. Hut 8 raised $8.3 million by selling a 6% stake to investors, about $800,000 more than its initial $7.5 million target, according to BlockBeats. Investors paid $1.45 a share for a total of 5.7 million units. Each unit contains one common share of Hut 8 and one equity certificate that gives investors the option to purchase Hut 8 common shares at a strike price of 1.85 over the next 18 months.

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Fidelity's investment in Hut 8 is significant because it has been mining bitcoin since 2014. Fidelity also hired a bitcoin mining engineer earlier this year to expand its operations. A Fidelity spokesman said: "Over the past few years, we have expanded our mining efforts and increased our understanding of this area. We have explored the best location, hardware procurement, stope setup and overall economics of the mining industry."

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Hut 8 began operations in 2017 and remains a lossmaking company, with adjusted EBITDA (earnings before interest, tax, depreciation and amortization) net income of -$600,000 and a loss of $1.3 million in the first quarter of 2019.

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