Riot Platforms Inc. ( RIOT ) has initiated a special shareholder meeting at Bitfarms Ltd. ( BITF ) , aiming to secure votes for three new board members as part of its strategy to acquire the competing Bitcoin (CRYPTO: BTC) mining firm.

What Happened: Last month, Riot, which now owns nearly 15% of Bitfarms ( BITF ), made an unsolicited offer to purchase the company for $950 million after Bitfarms ( BITF ) dismissed its initial approach in April.

Riot retracted its $2.30-per-share bid, citing the need for changes in Bitfarms’ boardroom to facilitate honest negotiations, according to a statement released on Monday, Bloomberg reported.

Bitfarms ( BITF ) is now required to schedule the special meeting within 21 days, where shareholders will decide whether to replace current chairman and interim CEO Nicolas Bonta, incumbent director Andrés Finkielsztain, and any successors to co-founder Emiliano Grodzki, who was recently removed from the board.

Riot stated, “The bottom line is this: over the course of more than a year of attempting to engage constructively with the Bitfarms ( BITF ) board regarding a potential combination of Bitfarms ( BITF ) and Riot, it has become evident to Riot that good faith negotiations simply will not be possible until there is real change in the Bitfarms ( BITF ) boardroom.”

The three candidates nominated by Riot for the Bitfarms ( BITF ) board are John Delaney, former mayor of Jacksonville, Florida; Ralph Goehring, a former CFO of an energy company; and Amy Freedman, an advisor to Ewing Morris and former CEO of Kingsdale Advisors.

A Bitfarms ( BITF ) representative did not immediately respond to requests for comments.

Riot has highlighted various governance issues at Bitfarms ( BITF ), including frequent management changes.

Last month, Bitfarms ( BITF ) dismissed interim CEO Geoffrey Morphy following his $27 million lawsuit against the company for breach of contract.

This month, Riot increased its stake in Bitfarms ( BITF ), which had earlier implemented a poison pill defense to counter Riot’s bid, claiming it undervalued the company’s growth potential.

Bitfarms ( BITF ), on its part, has launched a review of strategic alternatives and received multiple unsolicited expressions of interest, as stated earlier this month.

Also Read: Bitcoin Miner Heats Finnish Town Using Waste Heat From Mining BTC

Why It Matters: The developments occur amid a trend of consolidation in the crypto-mining sector, where large, cash-rich Bitcoin mining companies are expanding by acquiring smaller competitors.

This trend has been exacerbated by the recent Bitcoin halving, which slashed miners’ profit margins, leading to an estimated $10 billion in annual revenue losses.

Bitcoin mining, an energy-intensive process, involves miners using specialized computers to validate transactions on the blockchain in exchange for tokens.

The larger the computing power, the greater the likelihood of earning rewards, prompting mining companies to scale up operations.

Riot operates one of the largest Bitcoin mining facilities globally, located in Texas, with a total power capacity of 700 megawatts.

The company is also developing another site in Texas, expected to have a capacity of up to one gigawatt, enough to power 200,000 homes in the state.

What’s Next: As the industry navigates these changes, insights and discussions on the future of digital assets will be featured at Benzinga’s Future of Digital Assets event on Nov. 19.

Read Next: Mt. Gox To Start Repaying Bitcoin In July: $9B In Sell Pressure Coming?

Image created using artificial intelligence with Midjourney.