Bitfarms pay off $21M debt with one-time cash payment of $7.75M

Crypto miner Bitfarms has settled a $21 million debt owed to bankrupt crypto lender BlockFi with a one-time cash payment of $7.75 million, according to a Feb. 9 press statement.

Bitfarm agreed with BlockFi to restructure the debt and pay off the outstanding principal and interest in one transaction.

The original loan is a $32 million equipment finance facility offered by BlockFi on Feb. 18, 2022. With the loan repayment, Bitfarms' 6,100 miners' collateral for the loan is now unencumbered.

Bitfarms said the loan payment further reduces its debt obligations from $165 million in June 2022 to $25 million, representing an 85% decrease in less than nine months.

Bitfarms chief financial officer Jeff Lucas said:

“This successful negotiation and settlement furthers our initiatives to reduce indebtedness, enhance liquidity and increase financial flexibility in line with today’s market conditions.”

BlockFi was one of the most prominent financiers for crypto miners in 2021 and 2022, but it now has several bad debts. Bloomberg reported that the firm was looking to sell $160 million in loans to miners.