Novogratz and Galaxy Digital are investing $100 million to save Bitcoin miners from bankruptcy

Novogratz and Galaxy Digital are investing $100 million to save Bitcoin miners from bankruptcy

Michael Novogratz invests in the Argos Helios Bitcoin mining facility with his company Galaxy Digital. In addition, it is providing a $35 million loan to Argo. This is intended to protect the company from bankruptcy and begin restructuring.

Argo Helium can reduce debt

This news was published in a December 28 press release by Argo Blockchain. It shows that Galaxy Digital acquired the helium facility for a price of $65 million. The closing reduces the company’s total debt to about $41 million. At the same time, the transaction is intended to simplify the operating structure.

The notice goes on to say:

“Pursuant to an equity purchase agreement, the Argo subsidiary will sell its Helios facility and property in Dickens County, Texas, and related assets to Galaxy for $65 million (£54 million), subject to customary post-closing adjustments. In addition, Galaxy Argo will issue a new asset-backed loan of US$35m (£29m) with an initial term of 36 months. This funding is secured by a security package that includes 23,619 Bitmain S19J Pro miners currently operating at Helios and certain machines in Canadian Argo data centers.”

Argo Blockchain itself still owns the mining hardware. However, they are part of a security package that Galaxy receives for the life of the loan. These will remain in place for the next two years.

Argo Blockchain CEO Peter Wall said he was confident in the report, stressing that the sale was very important to the company.

“This transaction with Galaxy is a transformational transaction for Argo and benefits the company in a number of ways. It reduces our debt by $41 million and provides us with a stronger balance sheet and improved liquidity to ensure continued operations through the ongoing bear market. It also allows us to focus on optimizing our activities with a much lower investment [Kapitalausgaben] and opex requirements [Betriebskosten] focus”.

The proceeds of the purchase are to be used, among other things, for current debts, prepayments and ongoing fees. Some of this includes commitments by NYDG ABL LLC and North Mill Commercial Finance.

Galaxy expands mining with Helios rig

Helios is Argo’s largest mining facility. Up to 180 megawatts are used here to process Bitcoin and Co. This was opened in May 2022. Computing power of up to 20 exahash per second should be created here. The energy consumption should not be higher than 800 megawatts.

Galaxy Digital has two mining stations after acquiring the Helios facility. The company has been working on its own mining site for some time. A report from November 2022 states that a long-term solution is being worked on.

The mining facility itself is said to be located in Texas and is expected to be completed this month:

“GM is actively working on a number of longer-term solutions to diversify and reduce counterparty risk in order to reach our goal of 3,000 petahash per second (PH / s) in mining capacity… In addition, GM broke ground on its first owned mine. location in Texas, which is expected to be fully powered and operational by January 2023, allowing GM to scale its own mining operations responsibly and in a tax-efficient structure.”

Argos probably foresaw developments

The crypto winter has not only boosted the prices of cryptocurrencies. Mining also suffered greatly from the poor conditions. The situation worsened with the collapse leading to the FTX crisis in November 2022.

Argo Blockchain also felt compelled to take additional steps in October. The company reported that it had already had to sell individual mining machines after losing $27 million in shares.

According to the CEO, other ways to maintain the company’s funding cannot be ruled out.

Argos Blockchain is one of the most famous and largest Bitcoin mining companies. But the situation also affects other companies. Computer North filed for bankruptcy in September of last year. Bloomberg reported on this on 23 September. The high electricity costs and the turbulent market quickly created financial obstacles that could no longer be overcome.

A few weeks ago it was announced that Core Scientific had also filed for bankruptcy. Again, the energy crisis and falling prices were to blame. Another reason they are said to be unpaid debts on the part of Celcius Network. Crypto company Core Scientific is owed about $7 million.

Dash Trade 2: Higher returns and more security

Last year was a tragedy for the entire crypto scene. The recent losses suffered by traders and crypto companies are due to the bankruptcy of the FTX exchange.

Within hours, traders lost confidence in crypto platforms. The market clearly responded to this. However, according to some crypto experts,​​​​the events would be predictable.

The developers of the Dash 2 Trade platform want to offer their users a platform through which their own trading can be safer and more profitable. With a wide range of metrics, analytics and evaluations, they should be able to significantly simplify their trading.

Based on their offer, the developers assume that the Dash 2 Trading Panel would have predicted the FTX crash. The traders would have been notified and could act quickly.

Security is a top priority at Dash 2 Trade. With the help of an automatic trading bot, traders should have the opportunity to deal with losses. With this you should be able to set your user account so that a certain amount is sold as soon as the value is weakened. This means that there is no loss during absence.

The Dash 2 Trade pre-sale will end in less than two days. The tokens will be available for trading on January 11th. Traders will then be able to access it on three known platforms.

Photo by Daniel Thomas

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