Iris Energy, a Bitcoin Miner, Has Turned Off Hardware That Was Used as Collateral for More Than $100 Million in Loans

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Last Updated on November 22, 2022 by Bitfinsider

Iris Energy, a company that mines Bitcoin, has disconnected the vast majority of its miners after receiving a notice of default on around $107.8 million in loans that they were securing.

In a filing with the United States Securities and Exchange Commission on Monday, the business stated that the move will “not affect” the capacity of its data centers or the development pipeline for new data center infrastructure. Around 90 megawatts of capacity were made available as a result of this at a time when the prices of machines were falling dramatically.

Iris stated in a statement that the company is looking into “the prospect of utilizing $75 million of prepayments already made to Bitmain in respect of an additional 7.5 EH/s of contracted miners for further self-mining.” “The group continues to explore opportunities to utilize its available data center capacity, recognizing the current scarcity of industry hosting data center capacity,” Iris said. “The group also recognizes the current scarcity of industry hosting data center capacity.”

The company had previously stated that given current mining economics, the machines were not making enough money to pay for loans. The machines were generating around $2 million in BTC per month in gross profit, whereas the company had $7 million in debt obligations. This was stated in the company’s previous statement.

Iris was given a notice of default by its lender at the beginning of this month, and the lender is now anticipating that it will call back the machines.

After turning off about 3.6 EH/s worth of computers, the company reported that its current processing capacity is approximately 2.4 EH/s when taking into consideration 1.3 EH/s worth of miners in transit or pending deployment and 1.1 EH/s worth of machines that are now running.

The company also stated that it does not have any other outstanding debt facilities and that “The Facilities were intentionally structured for prudent risk management to protect the underlying business and data center infrastructure the Group has built” (i.e., without a parent company guarantee and without recourse to any other Group entities).

Iris has a total of $53 million in cash and cash equivalents as of the 31st of October.

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