Bitcoin Miner Marathon Digital Terminates Credit Facility With Crypto Bank Silvergate
The miner reduced its debt by $50 million and freed up about $75 million worth of bitcoin that was held as collateral.
One of the largest bitcoin miners, Marathon Digital (MARA), said it terminated its credit facilities with Silvergate Bank, which said Wednesday it will wind down operations and liquidate its assets.
Marathon said that on March 8 the term loan prepayment was completed and the company’s credit facilities with Silvergate Bank were terminated, reducing its debt by $50 million, according to a statement. The debt paid down also increased its unrestricted bitcoin holdings by 3,132 because the bitcoin that was being held as collateral by a third-party custodian was returned to the miner, the statement said.
"We have reduced our leverage by approximately $50 million, immediately freed up approximately $75 million in bitcoin that was being held as collateral for the term loan, and reduced our annual cash interest costs and facility fees by approximately $5 million," said Hugh Gallagher, Marathon’s chief financial officer, in the statement.
The company has been taking steps to shore up its balance sheet by paying off some of its debts and freeing up its restricted bitcoin that were being used as collateral. In January, Marathon said that it fully paid off $30 million in revolver loans with Silvergate in December, freeing up 3,615 bitcoin (BTC) that had been pledged as collateral.
The company also sold 650 bitcoin in February, following its sale of 1,500 bitcoin in January to pay for operating expenses and general corporate purposes. In after-hours trading on Wednesday, Marathon shares were down about 1%, in line with bitcoin's decline.
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