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Riot Platforms has purchased another 1 million shares of rival bitcoin miner Bitfarms, increasing its ownership to 18.9% of outstanding shares. The move advances Riot’s bid to acquire Bitfarms amid leadership changes and upcoming shareholder votes.

Riot Platforms now owns over 85.29 million shares of Bitfarms, cementing its position as the company’s largest shareholder. This latest acquisition, valued at approximately $2.28 million, comes just a day after Bitfarms co-founder and former chairman Nicolas Bonta stepped down from the board.

The leadership change continues, as Riot nominated three independent directors to Bitfarms’ board in July to replace Bonta and others. Bitfarms has scheduled a special shareholders’ meeting for October 29 to vote on recomposing the board, following Riot Platforms’ request for the June 24 meeting.

Financial challenges, rivalry

Both companies have faced financial challenges in recent quarters. Bitfarms reported a net loss of $27 million in its latest financial results, while Riot posted a net loss of $84.4 million in the second quarter, compared to a loss of $27.4 million in the same period last year. Despite these setbacks, both miners saw an increase in bitcoin production in July, with Riot and Bitfarms reporting a 45% and 34% increase respectively.

The takeover bid highlights a trend toward consolidation in the competitive crypto mining sector. As larger players like Riot seek to expand their influence, smaller operations may come under pressure to merge or be acquired. This shift could potentially lead to a more concentrated and efficient mining landscape, though it may raise concerns about centralization within the industry. Examples of such M&A activity in the crypto industry were recently explored by Crypto Briefing, which discussed Bakkt’s restructuring strategies.

Riot Platforms’ increase in its stake in Bitfarms to 18.9% is a sign that the company is looking to consolidate its power in the bitcoin mining sector, given the ongoing leadership changes and financial challenges for both companies.

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