Nasdaq-listed Bitcoin miner Argo Blockchain will receive a $100 million bailout deal from Mike Novogratz’s Galaxy Digital.
Argo agreed to sell its Helios mining facility in Texas to crypto investment firm Galaxy Digital for $65 million, CoinDesk reported on Wednesday. The Bitcoin miner willas also receive a $35 million loan from Galaxy as part of the deal which will shield it from declaring bankruptcy.
The deal involves a two-year hosting agreement with Galaxy which will enable Argo’s Bitcoin miners to keep running at the Helios facility.
“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. This deal with Galaxy achieves all of these goals, and it lets us live to fight another day,” said Argo CEO Peter Wall in an emailed statement to CoinDesk.
The news comes after Argo requested the Nasdaq stock exchange to suspend trading of its shares and unsecured notes on Dec. 27, citing the release of an upcoming announcement.
At our request, @Nasdaq temporarily suspended trading of Argo’s ADSs and unsecured notes for today – Tues Dec 27.
— Argo (@ArgoBlockchain) December 27, 2022
Argo’s shares, down 92% year-to-date, rose 80% on the London Stock Exchange during early trading hours on Wednesday.
The embattled Bitcoin miner is just one of many that have reported thin margins this year after Bitcoin’s price began its declining trajectory. Core Scientific, another publicly listed Texas-based Bitcoin miner filed for Chapter 11 bankruptcy on Dec. 21. Core reported a net loss of $434.8 million with only $4 million in remaining liquidity at the time of the filing, as per court documents reviewed by Reuters.
Data shared by Messari analyst Tom Dunleavy earlier this week further emphasized the dire situation that crypto miners currently find themselves in. According to his findings, publicly traded Bitcoin miners sold nearly 100% of the coins they mined in 2022.
BTC miners sell roughly 100% of the coins they mine
The 10 public bitcoin miners
detailed here mined ~40.7k BTC and sold ~40.3k in 2022
This is a persistent headwind for BTC and for no other reason a good thesis to be bullish the ETHBTC ratio trade pic.twitter.com/L1iI6Z07p7
— Tom Dunleavy (@dunleavy89) December 26, 2022