Hut 8 secures $50M loan to boost ‘financial flexibility’ ahead of merger, halving
Hut 8 produced 147 BTC in May and sold 179 BTC for $6.8 million
Elisabeth Coelfen/Shutterstock modified by Blockworks
Bitcoin mining company Hut 8 aims to enhance its “financial flexibility” by securing a loan prior to its upcoming merger with US Bitcoin Corp. and the anticipated bitcoin halving.
The proceeds of a $50 million credit facility — with lender Coinbase Credit — is to be used for “general corporate purposes,” the company said Monday, though declined to detail specific uses.
Hut 8 CEO Jaime Leverton added in a statement that the credit facility allows the company to maintain its “dynamic bitcoin treasury management strategy” ahead of the next bitcoin halving.
The supply of new bitcoins awarded to miners is halved at each halving event. Data from BitOoda indicates that bitcoin (BTC) prices have typically increased in the six months following each of the previous halvings.
Read more: Bitcoin halving a year out: Here’s what to expect
“We have one of the largest self-mined bitcoin stacks of any publicly traded company, and this credit facility allows us to maintain our HODL strategy while giving us financial flexibility,” a Hut 8 spokesperson told Blockworks in an email.
Hut 8 sold more bitcoin than it generated in May — producing 147 BTC during the month while selling 179 BTC for $6.8 million. Still, the company had 9,233 “unencumbered” bitcoins in its reserves as of May 31, it said in a June 9 news release.
The credit facility also comes as Hut 8 prepares to close its merger with US Bitcoin Corp — a deal first revealed in February.
Hut 8 said earlier this month that the combined company, set to be called Hut 8 Corp, is set to have a hash rate capacity of 7.5 exahashes per second (EH/s) across facilities in Alberta, Canada, as well as in New York, Nebraska and Texas.
A $15 million term loan is expected to be funded around the time of the credit facility’s closing, as well as the option for an additional $20 million one or two months later. A third loan tranche of an additional $15 million would come within 15 days after Hut 8’s combination with US Bitcoin Corp. is final.
Get the news in your inbox. Explore Blockworks newsletters:
- Blockworks Daily: The newsletter that helps thousands of investors understand crypto and the markets, by Byron Gilliam.
- Empire: Start your morning with the top news and analysis to inform your day in crypto.
- Forward Guidance: Reporting and analysis on the growing intersection of crypto and macroeconomics, policy and finance.
- 0xResearch: Alpha directly in your inbox. Market highlights, data, degen trade ideas, governance updates, token performance and more.
- Lightspeed: Built for Solana investors, developers and community members. The latest from one of crypto’s hottest networks.
- The Drop: For crypto collectors and traders, covering apps, games, memes and more.
- Supply Shock: Tracking Bitcoin’s rise from internet plaything worth less than a penny to global phenomenon disrupting money as we know it.
