Rhodium Encore LLC, a bankrupt bitcoin mining company, has received court approval for a unique debtor-in-possession financing plan that allows borrowing in either U.S. dollars or bitcoin. Galaxy Digital Holdings Ltd., a blockchain firm led by Mike Novogratz, has offered to provide Rhodium with a loan of either $30 million in dollars or 500 bitcoin. The dollar loan carries a 14.5% interest rate, while the bitcoin loan has a 9.5% interest rate. Rhodium can repay the BTC loan in dollars at a reasonable market rate at closing. This type of cryptocurrency-based funding is rare in Chapter 11 bankruptcies due to bitcoin’s volatility. Rhodium filed for bankruptcy in August 2024, primarily due to financial issues stemming from a dispute with its landlord and power supplier, Whinstone US Inc., which was later acquired by Rhodium’s competitor, Riot Platforms.
Court Approves BTC Loan for Bankrupt Bitcoin Mining Firm
This article was published more than a year ago. Some information may no longer be current.
WRITTEN BY
SHARE
