Bitcoin miner Greenidge cuts NYDIG debt from $72 million to $17 million

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Bitcoin (BTC) mining company Greenidge Generation Holdings has significantly reduced its debt with investment management firm New York Digital Investment Group (NYDIG).

On January 30, Greenidge entered into several agreements associated with its secured debt with NYDIG, transferring ownership of Bitcoin mining hardware and certain credits to NYDIG. The transaction reduced the principal and accrued interest balance of the debt to NYDIG from approximately $76 million to approximately $17 million, resulting in a total debt reduction of approximately $59 million.

One of the agreements, the Senior Secured Loan Agreement, also provides the option of voluntary prepayment of the loan by transferring ownership of certain mining infrastructure assets. Subject to a binding agreement from NYDIG, the loan agreement has the potential to reduce the principal debt balance to approximately $7 million.

As previously reported, Greenidge originally signed the deal in mid-December 2022, expecting to reduce its NYDIG debt by at least $57 million and up to $68 million.

The debt restructuring we announced today significantly improves our balance sheet and gives us a clear path into 2023, said Greenidge CEO Dave Anderson. The executive expressed confidence in the strong development of the mining industry ahead, saying:

The completion of this debt restructuring, coupled with the execution of the new hosting agreements, has significantly improved our immediate liquidity and allows us to continue to participate in the future upside potential of Bitcoin.

Despite the company’s essential restructuring into a hosting company for Bitcoin mining rigs, Greenidge continues to own around 10,000 miners, maintaining a capacity of 1.1 exahash per second (EH/s), the company said. .

Amid a tough winter for cryptocurrencies, many mining companies have taken steps to reduce debt using similar strategies. In late December 2022, Argo Blockchain reduced its total debt by $41 million by selling its flagship mining facility Helios and securing a $35 million loan from Mike Novogratz’s crypto investment firm Galaxy Digital.

Related: Public Bitcoin Mining Companies Struggling With $4 Billion in Collective Debt

In addition to the debt reduction, Greenidge also released preliminary financial results for the fourth quarter of 2022, reporting $15 million in revenue and up to $130 million in losses. The company produced approximately 683 BTC ($15.7 million) during 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 approximately $2.6 million.

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