Hut 8 secures $50 million credit facility from Coinbase
Hut 8 will have the option to draw $20 million and $15 million after the first tranche.
The $50 million loan facility will mature one year after the first borrowing, and bear interest.
CEO Jaime Leverton noted in a statement that the funds will give Hut 8 financial flexibility ahead of Bitcoin’s halving.
Bitcoin mining company Hut 8 Mining has announced a $50 million loan facility secured from crypto exchange Coinbase’s subsidiary Coinbase Credit.
Hut 8 will use the funds to support its operations, including closing the deal for the merger with US-based miner Bitcoin Corp (USBTC).
Financial flexibility
According to details in a press release published on Monday, Hut 8 can access the loan facility in three tranches. The first, expected to be secured shortly is a term loan worth $15 million, and there are options for further drawings of $20 million and $15 million – the second of which will be a delayed draw term facility available one to two months later.
The mining platform will be able to tap into the third tranche of $15 million 15 business days after it closes its merger with USBTC.
“This credit facility gives us additional financial flexibility,” Hut 8 CEO Jaime Leverton commented. He noted that the loan will help the company maintain its dynamic Bitcoin treasury as the market edges closer to the next Bitcoin halving.
“All amounts borrowed under the Credit Facility will bear interest at a rate equal to (a) the greater of (i) the federal funds rate on the date of the applicable borrowing, and (ii) 3.25%, plus (b) 5.0%. The Credit Facility matures 364 days after the date of the first borrowing,” the company wrote in the press release.
The credit facility will mature 364 days after Hut 8’s first borrowing and loan obligations are secured by the miner’s Bitcoin held by Coinbase Custody.
Hut 8 stock was down 9% at the time of writing, although it remained more than 200% up in 2023 after rallying alongside cryptocurrencies. COIN shares were on the other hand trading at 2.3% higher on the day and 87% YTD.
The post Hut 8 secures $50 million credit facility from Coinbase appeared first on CoinJournal.
Filed under: Bitcoin - @ June 26, 2023 6:25 pm