Maple Finance and Icebreaker Launch Lending Pool for Bitcoin Miners

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Major DeFi lender Maple Finance has launched a capac­i­ty pool worth $300 mil­lion for Bit­coin min­ing companies.

The devel­op­ment comes despite the sharp decline in BTC’s price and the reduced injec­tion of cap­i­tal into the min­ing sector.

Maple Opens Up Fully-Collateralized $300 Million Lending Pool

Accord­ing to an announce­ment on Tues­day (Sep­tem­ber 20, 2022), the new fund tar­gets “pub­lic and pri­vate blue-chip bit­coin min­ing and dig­i­tal asset infra­struc­ture com­pa­nies” based in North Amer­i­ca and Australia.

The pool offers under­ly­ing loans with a tenor of 12–18 months, along with an inter­est rate between 15–20%. Aus­tralian finan­cial ser­vices firm Ice­break­er Finance will man­age and admin­is­ter the loans via Maple’s plat­form. Fund­ing will be admin­is­tered to bor­row­ers based on the bal­ance sheet strength, oper­a­tional effi­cien­cy, and finan­cial performance.

Fur­ther­more, loans will be secured by either real-world assets like min­ing rigs and pow­er trans­form­ers or dig­i­tal assets.

Com­ment­ing on the lat­est devel­op­ment, Ice­break­er Finance founder and CEO Glyn Jones said:

“The mar­ket is now matur­ing to appre­ci­ate that non-recourse SPV ASIC backed financ­ing can 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 enables us to align incen­tives of lenders and bor­row­ers to exe­cute loans on-chain with terms that reflect the emerg­ing nature of the indus­try more effi­cient­ly than we could elsewhere.”

Financing Woes for Bitcoin Miners

The news is com­ing amid a tur­bu­lent peri­od for bit­coin min­ers in the area of secur­ing financ­ing for their oper­a­tions. The cryp­to bear mar­ket has seen min­ing firms strug­gle to secure loans and pay back creditors.

Back in June, bit­coin min­ers were strug­gling to repay loans worth about $4 bil­lion, which were backed by their equip­ment. As pre­vi­ous­ly report­ed by Cryp­toPota­to, Bit­coin min­er Core Sci­en­tif­ic sold over 7,000 BTC in June alone, for an aver­age price of $23,000 per coin, leav­ing the com­pa­ny with 1,959 BTC in its coffers.

The com­pa­ny lat­er entered an agree­ment with the invest­ment firm B. Riley, which will see the lat­ter pur­chase $100 mil­lion in com­mon stock of Core Sci­en­tif­ic over two years.

Maple Finance co-founder and CEO Sid­ney Pow­ell said:

“Recent mar­ket head­winds have caused lenders to pull back, while tra­di­tion­al financ­ing vehi­cles have been slow­er to engage this sec­tor. Min­ers play an essen­tial role in grow­ing the cryp­to ecosys­tem and local economies, and we are proud to extend a new financ­ing vehi­cle to direct cap­i­tal where it is need­ed the most.”

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