Bitfarms CFO Jeff Lucas revealed that the settlement allowed to lower the firm's overall debt to $25 million.
Bitfarms, a global Bitcoin (BTC) mining company established in 2017, has modified its loan agreement with a digital asset lender BlockFi.
According to the press release shared on February 9th, Bitfarms has made an agreement to pay off its breathtaking $21 million debt obligation for “a single cash payment of $7.75 million.”
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It is worth noting that the news about Bitfarms' plans to alter its loan agreement with BlockFi broke on January 13th. At that time, the company allegedly sought to obtain “more favorable terms” and warned that if there was no agreement, the company may not pay its loan at all.
In February 2022, BlockFi gave a loan to Bitfarms’ owned US-based subsidiary, Backbone Mining Solutions. At that time, BlockFi lent $32 million to Backbone Mining Solutions to equip its facility. At the end of January 2023, the outstanding principal and interest on the loan totaled $21 million.
In the press release, Bitcoin mining firm’s chief financial officer (CFO) Jeff Lucas, noted:
Combined with the earlier restructuring and elimination of our capital expenditure obligations in December, this successful negotiation and settlement furthers our initiatives to reduce indebtedness, enhance liquidity and increase financial flexibility in line with today’s market conditions.
On top of that, Lucas revealed that this settlement allowed the firm to lower its overall debt to $25 million. The company’s CFO claims that this move boosted Bitfarm’s “cash flow and position for future growth.”
Moreover, Bitfarm’s CFO highlighted that the company's remaining debt is secured by mining equipment in Quebec, which is set to mature in a year. Therefore, according to Lucas, the company expects to be debt free “before the next halving event expected in May 2024.”
It is worth remembering that crypto lender BlockFi filed for bankruptcy at the end of November after the collapse of crypto exchange FTX.
