- Icebreaker Finance will provide fully secured loans to blue chip mining companies.
- Loan periods are from 12-18 months and interest rates from 15-20%.
- The fund is open to miners in North America, Canada and Australia, the company announced on Tuesday.
Icebreaker Finance, an Australia-based company looking to use blockchain technology to improve capital markets, has unveiled a $300 million fund on DeFi platform Maple to help fund bitcoin miners.
The fund will focus on secured debt financing for the leading bitcoin mining companies — both public and private — in North America, Canada and Australia, the company said.
Icebreaker’s move comes at a time when many BTC mining companies are struggling amid the crypto winter and rising electricity costs, with some choosing to sell their mined coins to meet their cash obligations.
“Recent market headwinds have caused lenders to pull out, while traditional financing vehicles have been slower to enter this sector. Miners play a vital role in the growth of the crypto ecosystem and local economies, and we are proud to expand a new financing vehicle to direct capital where it is needed mostsaid Sidney Powell, CEO and co-founder of Maple Finance.
Loans collateralized to blue-chip miners
As Icebreaker Finance points out in its announcement, miners can now access 12-18 month loans at interest rates of around 15-20% to boost their operations.
Offered to blue-chip Bitcoin miners, the loans will be handled with the first priority, with Icebreaker evaluating each need based on a miner’s balance sheet strength, treasury, financial performance and operational efficiency, among other things.
Collateral will be through both real-world assets and digital assets, with the former requirement including mining rigs and power transformers, among other infrastructure assets.
The appeal will be on the borrower, Icebreaker noted in its blog post, with company founder and CEO Glyn Jones commenting on this by noting:
“The market is now maturing to realize that non-recourse SPV ASIC backed funding may be inappropriate given the volatility in value of ASICs. Instead, a more diverse security package is required. Maple’s out-of-the-box, on-chain lending toolkit allows us to tailor lenders’ and borrowers’ incentives to perform on-chain lending on terms that more efficiently reflect the emerging nature of the industry than we could elsewhere.”