As the cryptocurrency market decreases to near collapse, many companies are feeling the strain. One is the Bitcoin miner Argo Blockchain (ARBK), which is now filing for protection against bankruptcy following its sale of the Helios mining facility.
Argo Blockchain reached an agreement with Galaxy Digital to sell the Dickens County, Texas facility for $65 million. Alongside a $35 million loan from investor Michael Novogratz's crypto-focused financial-services firm, the company thinks it can prevent going bankrupt.
As for that loan, it is secured against the ARBK mining equipment, the company confirms:
“Over the last few months, we have been looking for a way to continue mining through the bear market, reduce our debt load and maintain access to the unique power grid in Texas,” Argo CEO Peter Wall told CoinDesk. “This deal with Galaxy achieves all of these goals, and it lets us live to fight another day.”
Essentially, the financial levers allow Argo to boost its balance sheet and continue to fight off bankruptcy. That was a real possibility following a deal to secure $27 million in funding that collapsed in October.
Alongside the sale of the mining facility, Argo has also agreed to a two-year hosting license with Galaxy Digital. This will allow the company to keep its computing and mining operation at the Helios facility.
Galaxy president Chris Ferraro says the deal was purposely structured to allow Argo to top up its balance sheet and stay operational.
“Galaxy is aspiring to be one of the most trusted nodes of the decentralized future,” Ferraro said in the statement. “The acquisition of Helios represents a new stage over our two-year journey in bitcoin mining that increases our operating scale and breadth of solutions, creating sustainable value for the biggest decentralized digital-asset network and shareholders alike.”
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