Frank Holmes has a quick answer for anyone asking whether a Bitcoin crash could derail HIVE Digital Technologies' expansion into AI. The price of Bitcoin is not what keeps him up at night. Go
Frank Holmes has a quick answer for anyone asking whether a Bitcoin crash could derail HIVE Digital Technologies' expansion into AI. The price of Bitcoin is not what keeps him up at night. Governments are.
"You need to have stable government policies," the executive chairman told TheStreet Roundtable.
Holmes has led HIVE into what it calls a dual engine model: Tier 1 sites mining Bitcoin and Tier 3 data centers running AI workloads through its BUZZ HPC subsidiary, spread across Canada, Sweden and Paraguay.
The company can afford the ambition. For the quarter ended June 30, 2026, HIVE reported revenue of $79.1 million, up 73.5% year over year, adjusted EBITDA of $13.4 million and more than $200 million in cash. It also reported a net loss of $142.9 million, and the biggest single reason for that loss is exactly the risk Holmes is describing.
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Sweden was HIVE's first international bet, and Holmes says the welcome did not last.
"We've demonstrated that the instability in Sweden, where we first went in, it was all great, and we paid tens of millions in taxes. But their tax agency doesn't like Bitcoin mining, so anyone in Tier 1 data center is now evil and they're going to ruin your business," he said.
The Swedish Tax Agency argues that proof-of-work mining has no identifiable counterparty, which places it outside the scope of value-added tax. Under that reading, the VAT HIVE paid on equipment and power is not recoverable. HIVE has lost at two levels of Swedish court and booked an $84.7 million provision, which it is appealing.
Paraguay, home to HIVE's largest power capacity, has tested him differently.
"Paraguay started off this year with an incredible AI strategy to offer long-term energy contracts, but that all of a sudden got morphed, and they're still wrestling with what that strategy will be. And so you just don't know. That's the big part," he said.
A Bitcoin mining site costs about $1 million per megawatt to build. A Tier 3 AI data center, with backup power, redundant internet and duplicated systems, runs closer to $30 million, a comparison Holmes has made before.
"And the reason why you need these long-term energy contracts, because the capex is 30 times greater. So you can't take the risk of saying, okay, we're gonna go in for 100 megawatts and that's gonna cost us three billion dollars, and the government changes all the policies, they change their energy contract, your money's gone," he said.
A miner facing a hostile government can unplug its machines and ship them somewhere friendlier. A $3 billion AI facility cannot. That asymmetry, not the Bitcoin chart, is what Holmes says decides where HIVE builds.
