Bitcoin (BTC) mining company Greenidge Generation has significantly reduced its debt with investment management firm, New York Digital Investment Group (NYDIG).
January 30, Greenidge she got here in into several deals related to her secured debt with NYDIG transferring ownership of bitcoin mining equipment and a few loans to NYDIG. The transaction reduced NYDIG’s principal and accrued interest balance from roughly $76 million to roughly $17 million, leading to a complete debt reduction of roughly $59 million.
One of the agreements, the soft loan agreement, also provides for the opportunity of voluntary early repayment of the loan by transferring the ownership of certain mining infrastructure assets. Subject to a binding agreement entered into by NYDIG, the loan agreement has the potential to cut back the principal of the debt to roughly $7 million.
As previously reported, Greenidge originally signed the deal in mid-December, expecting to cut back NYDIG debt by a minimum of $57 million and a maximum of $68 million.
“The debt restructuring we announced today significantly improves our balance sheet and provides us a transparent path ahead for 2023,” said Greenidge CEO Dave Anderson. The Executive Director expressed confidence within the strong development of the mining industry, stating:
“The completion of this debt restructuring, coupled with the execution of latest hosting deals, has greatly improved our immediate liquidity and allows us to proceed to take part in Bitcoin’s future growth potential.”
Despite essentially restructuring the corporate right into a hosting company for Bitcoin mining rigs, Greenidge still owns around 10,000 miners, maintaining a performance of 1.1 exahash per second (EH/s), the corporate said.
During the tough crypto winter, many mining firms aim to cut back their debt using similar strategies. In late December, Argo Blockchain reduced its total debt by $41 million by selling its flagship Helios mining facility and securing a $35 million loan from Mike Novogratz’s cryptocurrency investment firm, Galaxy Digital.
Related: Public bitcoin mining firms plagued with $4 billion in collective debt
In addition to debt relief, Greenidge also released preliminary financial results for the fourth quarter of 2022, reporting $15 million in revenue and as much as $130 million in losses. The company produced around 683 BTC ($15.7 million) within the fourth quarter of 2022.
Greenidge also mentioned the sale of its software subsidiary Support.com on January 17. The sale generated net proceeds of roughly $2.6 million.