Bitcoin miner Hut 8 (HUT), now focusing on energy and AI computation, has refinanced its $200 million bitcoin-backed credit facility by replacing its existing arrangement with Coinbase Credit in favor of a new deal with FalconX. The company achieved a reduction in its fixed interest rate from 9% to 7%, marking a 200-basis-point improvement as per a press release. This strategic move aligns with Hut 8’s goal of lowering its bitcoin-backed credit costs and overall capital expenditure. Additionally, the refinancing has released roughly 3,300 bitcoins previously used as collateral—worth approximately $260 million as of May 1—enhancing capital deployment flexibility.
“This refinancing bolsters our balance sheet by reducing debt costs while increasing liquidity through Bitcoin held outside of collateral covenants,” stated Sean Glennan, CFO of Hut 8. “It furthers our goal to optimize bitcoin’s role on our balance sheet and decrease capital costs.”
Mining companies are increasingly refinancing to secure better terms and free up funds for AI ventures, moving away from the fluctuating revenues linked with bitcoin mining in favor of stable long-term leases.
Last week, Hut 8 announced the pricing of $3.25 billion in senior secured notes intended to fund a 245-megawatt data center at its River Bend campus in St. Francisville, Louisiana, as per an April 28 SEC filing. This project, unveiled in December, involves a 15-year lease worth $7 billion with AI infrastructure firm Fluidstack, supported by Google, and could potentially reach up to $17.7 billion if all renewal options are utilized.
In a similar vein, another mining company, Riot, recently enhanced its terms on a $200 million bitcoin-backed credit facility with Coinbase, reducing the rate from 8.3% to a fixed 6.15%, thereby releasing 1,544 bitcoins previously pledged as collateral—a sign of growing lender confidence in its data center expansion.
Hut 8’s shares appreciated by about 1.5% on Monday following bitcoin’s surge above $80,000.