Hut 8 Refinances Bitcoin-Backed Credit Facility with $200 Million FalconX Deal
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Key Takeaways
- The new $200 million facility with FalconX reduces Hut 8's cost of debt to a 7.0% fixed interest rate.
- The refinancing unencumbers approximately 3,300 BTC, valued at $260 million, increasing the company's available liquidity.
Hut 8 (NASDAQ: HUT) has replaced its Bitcoin-backed credit facility with FalconX in a refinancing deal that lowers borrowing costs and frees up thousands of Bitcoin previously tied up as collateral, underscoring the company’s broader push to strengthen liquidity as it expands into AI and high-performance computing infrastructure.
The company said Monday it entered into a new $200 million, 364-day Bitcoin-backed facility with FalconX carrying a fixed 7% interest rate, replacing its prior loan agreement with Coinbase. The new rate represents a 200-basis-point reduction from the 9% rate on the previous Coinbase facility and marks a cumulative improvement of as much as 450 basis points from the double-digit borrowing costs Hut 8 paid in earlier iterations of the loan.
The refinancing also released about 3,300 BTC from collateral requirements, equivalent to roughly $260 million based on Bitcoin prices as of May 1, according to the company. Hut 8 said the move increases the amount of unencumbered Bitcoin on its balance sheet, giving it greater liquidity and flexibility for future investments.
The structure of the FalconX facility also removes a feature that had become increasingly burdensome for some miners during Bitcoin price declines: an escalating collateral requirement tied to loan-to-value thresholds.
