By: Franyi Sarmiento, Ph.D., Inspenet, June 23, 2022
Canadian cryptocurrency mining company Bitfarms sold approximately USD 62 million worth of Bitcoin (BTC) in June, using the proceeds from the sale to reduce its debt.
In an announcement on Tuesday, Bitfarms said it had sold 3,000 bitcoins in the past seven days, approximately 47% of the 6,349 BTC held by the cryptocurrency mining company. According to the company, it will use the proceeds from the sales of BTC -USD 62 million- to “rebalance its indebtedness by reducing its BTC-backed credit facility with Galaxy Digital.”
The cryptocurrencies sold apparently included 1,500 BTC that Bitfarms used to reduce its USD 100 million credit facility by USD 66 million in June, reducing its debt to USD 38 million at the time of publication of this story.
According to Bitfarms CFO Jeff Lucas, the mining company is “no longer making HODL “of all the bitcoins it produces daily – approximately 14 BTC – but has instead opted to “take steps to improve liquidity and strengthen” the company’s balance sheet. Bitfarms said it also closed a USD 37 million deal with NYDIG to finance equipment, bringing the company’s liquidity to about USD 100 million.
“While we remain bullish on BTC’s long-term price appreciation, this strategic shift allows us to focus on our top priorities of maintaining our world-class mining operations and continuing to grow our business in anticipation of the improving mining economy,” Lucas said. “We believe that selling a portion of our BTC holdings and daily production as a source of liquidity is the best and least costly method in the current market environment.”
Bitfarms had a reported 4,300 BTC in January, worth approximately USD 177 million when the cryptoasset was priced at over USD 41,000. Founder and CEO Emiliano Grodzki said at the time that the company’s strategy was to “accumulate the most Bitcoin for the least cost and in the fastest amount of time.”
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