The new credit facility will be payable across 18 months, reducing interest payments by over US$300,000 annually.
Hut 8 Mining (TSX:HUT), a blockchain mining company with mining facilities in Medicine Hat, Alberta announced that it has refinanced its debt. The company has received a new US$15 million loan from Genesis Global Capital at a rate of 9.85 percent over 18 months and a bullet repayment. Previously, Hut 8 had worked with Galaxy Digital Lending in a US$14 million loan.
As quoted in the press release:
“This refinancing is a major step in improving Hut 8’s cash flows and will reduce our interest costs by $426k (US$323k) per year,” said Jimmy Vaiopoulos, Chief Financial Officer of Hut 8. “Our ability to refinance debt on better terms is a testament to our performance and ability to stand out as a low cost bitcoin miner”.
“Utilizing lower interest rates as part of this refinancing, holding a significant bitcoin balance, and cash on hand, our balance sheet continues to be a distinct advantage for Hut 8,” said Andrew Kiguel, Chief Executive Officer of Hut 8.
In addition, Hut 8 switched mining pool services from Slushpool to the Bitfury Group in December 2018. This has allowed for significant cost savings as we moved to a fixed fee of US$226k (US$200 per month per BlockBox Data Center AC) at current bitcoin prices from a 2% fee of all revenues which was nearly $1 million for the 2018 year.