Bitcoin mining company Hut 8 Mining has announced a $50 million loan facility secured from crypto exchange Coinbase’s subsidiary Coinbase Credit. The miner will use the funds to support its operations, including closing the deal for the merger with US-based miner Bitcoin Corp (USBTC).
CEO Jaime Leverton noted in a statement that the loan will give Hut 8 financial flexibility ahead of Bitcoin’s halving. The credit facility consists of 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 loan obligations are secured by Hut 8’s Bitcoin held by Coinbase Custody.
The second tranche of $20 million will be available one to two months after the first borrowing, while the third tranche of $15 million will be available 15 business days after the completion of the merger with USBTC. The loan will bear interest at the greater of the federal funds rate on the date of the applicable borrowing, and 3.25%, plus 5.0%. The facility will mature 364 days after Hut 8’s first borrowing.
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 trading at 2.3% higher on the day and 87% YTD.
