Hut 8 Builds Positive Momentum and Value for Shareholders with Repayment of U$20M capital loan

As part of its commitment to shareholders repayment to Genesis Global Capital reduces capital expenditures and saves Hut 8 U$1.6M per year

TORONTO, Jan. 27, 2021 - Hut 8 Mining Corp. (TSX: HUT) announced today that it has finalized plans to repay its U$20M loan with Genesis Global Capital ("Genesis").

The Genesis loan allowed the company to hold a larger bitcoin balance by using its bitcoin as collateral for a loan. This strategy has provided significant benefit to Hut 8 as the price of bitcoin has increased far more than the interest on the loan of 8% per annum.

Hut 8 plans to repay the Genesis loan in full in mid-February, 2021 as a one month repayment notice was required, which will provide a financial benefit of US$2.4M. This is driven by the savings from interest expenses of US$1.6M and the fact that the bitcoin collateral will instead be used towards Hut 8's previously disclosed yield account with Genesis which will be generating US$0.8M in interest income.

"Paying the Genesis loan is a major step in improving Hut 8's balance sheet and cash flow by turning US$1.6M of interest expenses into US$0.8M of interest income," said Jimmy Vaiopoulos, Chief Financial Officer of Hut 8. "Our ability to secure cost savings via low interest loans and subsequently paying them off in full is a testament to our performance and ability to stand out as a low cost bitcoin miner."

"I am proud of Hut 8's strategic and economic approach to refinancing prior debt and am pleased to be announcing our plans for a bullet repayment in February of this year." said Jaime Leverton, CEO, Hut 8. "The robust BTC holdings on our balance sheet is a key differentiator for the company and the Genesis loan allowed us to maintain this crucial strength while reducing our fiat spending. Paying it in full illustrates Hut 8's strategy for growth, providing incremental value to shareholders and ensuring our unique position as a global leader in mining."

To realize the full potential of Hut 8 in the current market and beyond, the company has steadily been building momentum with proactive steps to strengthen its fleet and equipment management as well as new strategic hires including Sue Ennis, Head of Investor Relations, Tanya Woods, General Counsel / EVP of Regulatory and Jason Zaluski, Head of Technology.

About Hut 8: Hut 8 is a bitcoin mining company with industrial scale operations in Canada. Hut 8 creates value for investors through low production costs and appreciation of its bitcoin inventory. The company provides investors with direct exposure to bitcoin, without the technical complexity or constraints of purchasing the underlying cryptocurrency. Investors avoid the need to create online wallets, wire money offshore, and safely store their bitcoin.

The Company's common shares are listed under the symbol "HUT" on the TSX and as "HUTMF" on the OTCQX Exchange.

Key investment highlights and FAQ's: https://www.hut8mining.com/investors.

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FORWARD-LOOKING STATEMENTS

Certain information in this press release constitutes forward-looking information. In some cases, but not necessarily in all cases, forward-looking information can be identified by the use of forward-looking terminology, such as "plans", "targets", "expects" or "does not expect", "is expected", "estimates", "intends", "assumes", "anticipates" or "does not anticipate" or "believes", or variations of such words and phrases, or state that certain actions, events or results "may", "could", "would", "might", "will" or "will be taken", "occur" or "be achieved". In addition, any statements that refer to expectations, projections or other characterizations of future events or circumstances contain forward-looking information. Statements containing forward-looking information are not historical facts, but instead represent management's expectations, estimates and projections regarding future events.

Forward-looking information is necessarily based on a number of opinions, assumptions and estimates that, while considered reasonable by Hut 8 as of the date of this press release, are subject to known and unknown risks, uncertainties, assumptions and other factors that may cause the actual results, level of activity, performance or achievements to be materially different from those expressed or implied by such forward-looking information, including but not limited to the factors described in greater detail in the "Risk Factors" section of the Filing Statement dated March 1, 2018 relating to the Qualifying Transaction of Oriana Resources Corporation and Hut 8, which is available at www.sedar.com. These factors are not intended to represent a complete list of the factors that could affect Hut 8; however, these factors should be considered carefully. There can be no assurance that such estimates and assumptions will prove to be correct. The forward-looking statements contained in this press release are made as of the date of this press release, and Hut 8 expressly disclaims any obligation to update or alter statements containing any forward-looking information, or the factors or assumptions underlying them, whether as a result of new information, future events or otherwise, except as required by law.

Neither the TSX nor its Regulation Services Provider (as that term is defined in the policies of the TSX) accepts responsibility for the adequacy or accuracy of this release.

SOURCE Hut 8 Mining Corp.