Argo's $22 Million BTC-Backed Loan from Galaxy Digital

Argo Blockchain has joined other crypto mining firms in selling part of its Bitcoin holdings, including Bitfarms, Core Scientific, and Riot Blockchain.

In a Thursday blog post, Argo announced that it had sold 637 Bitcoin (BTC) in June for an average price of $24,500 - approximately $15.6 million. The funds were intended to be used to reduce the company's debt to Galaxy Digital, from which Argo secured separate $20-million and $25-million BTC-backed loan agreements in 2021. As of June 30th, the mining company reported that it had an outstanding balance of $22 million on the loan and held "sufficient liquidity" to avoid any potential liquidation if Bitcoin's price continues to decline.

“Our risk management strategy has helped us reduce our exposure to the BTC-backed loan, and we have hired a full-time derivatives trader. As a result, we are well positioned to navigate the current market conditions and increase our efficiencies," said Argo CEO Peter Wall.

In June, following the crypto sales, Argo said it held 1,963 BTC and BTC equivalents as of June 30. That was 18% less than that reported in May. Other mining firms including Bitfarms, Core Scientific and Riot Blockchain also sold a significant percentage of their BTC holdings amid the market downturn as the price of the crypto asset dropped under $18K.

Argo said in May that it had halted mining activities at its Helios facility in Dickens County, Texas after high temperatures led to “increased energy demand and higher electricity prices.” However, the following month's report showed an increase in mined BTC from 124 to 179 due to "higher uptime" at the facility. Riot Blockchain also announced on Thursday plans to relocate some of its mining fleet from New York to Texas.