Hut 8 expands borrowing capacity with Coinbase to $65 million, acquires natural gas power plants Hut 8 expands borrowing capacity with Coinbase to $65 million, acquires natural gas power plants
Hut 8 also obtained court approval to acquire four natural gas power plants in Ontario, Canada.
2 min read
Updated: Jan. 12, 2024 at 2:36 pm UTC
Cover art/illustration via CryptoSlate. Image includes combined content which may include AI-generated content.
Bitcoin miner Hut 8 has secured an additional $15 million from a subsidiary of the United States-based cryptocurrency exchange, Coinbase, according to a Jan. 12 statement.
The miner revealed that the new deal represents an amendment and restatement of its previous $50 million credit facility with the cryptocurrency trading platform, bringing its cumulative credit portfolio to $65 million.
Last year, Hut 8 procured a $50 million credit facility from Coinbase, with an added provision for an optional $15 million term loan.
The BTC miner plans to use the newly acquired $15 million loan for general corporate purposes, mirroring the allocation of funds from the preceding financial arrangement. The new loans also carry the same interest rate as the previous ones.
“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%.”
Hut 8 further explained that the loan is secured by its interest in an unspecified amount of Bitcoin held in Coinbase Custody, adding that the loan will mature 364 days after the date of the first borrowing.
New natural gas power plants
Meanwhile, Hut 8 recently obtained court approval from the Ontario Superior Court of Justice to acquire four natural gas power plants in Ontario.
The approval empowers Hut 8’s newly established Canadian subsidiary, BidCo, to execute the acquisition of a 40 MW facility in Kapuskasing, a 110 MW facility in Kingston, a 120 MW facility in Iroquois Falls, and a 40 MW facility coupled with a Bitcoin mining operation in North Bay.
Along with the approval, a novel funding arrangement is set to materialize between Macquarie and BidCo. Macquarie partnered with the miner to submit the bid for the North Bay Bitcoin mine.
This financial agreement will manifest as an operating lease facility, with Macquarie securing a 20% stake and Hut 8 retaining an 80% equity interest. The anticipated closure of this transaction is slated for Feb. 15, contingent upon the resolution of all pending litigation claims.
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Oluwapelumi Adejumo
Oluwapelumi values Bitcoin's potential. He imparts insights on a range of topics like DeFi, hacks, mining and culture, underlining transformative power.
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Bitcoin, a decentralized currency that defies the sway of central banks or administrators, transacts electronically, circumventing intermediaries via a peer-to-peer network.
Hut 8
Hut 8 is a digital asset miner with two digital asset mining sites located in Southern Alberta and a third site in North Bay, Ontario, Canada.
Coinbase
Coinbase is a digital currency exchange and wallet service that allows individuals to buy, sell, and store digital currencies, such as Bitcoin, Ethereum, and Litecoin.
