News22 November 2022

Australian bitcoin miner forced to pay $107.8 million debt


Australia's Iris Energy has received a notice of demand from its lender and bitcoin miner Bitmain Technologies for failing to pay a $107.8 million loan.

In a Nov. 21 filing with the U.S. Securities and Exchange Commission (SEC), Iris Energy said it received notice of default and acceleration from Bitmain on a $107.8 loan to two wholly-owned particular purpose vehicles (SPVs).

According to the filing, Bitmain sent the notice demanding full repayment of the debt after Iris Energy failed to engage in "good faith discussions about restructuring" the financing line.   

Iris said that due to the notice, some of its other subsidiaries terminated their respective hosting agreements with two SPVs owned by the subsidiaries.

Both companies failed to make scheduled principal payments by their maturity dates of Nov. 8, 2022, and as a result, received a notice of default from Bitmain last week.

However, the company acknowledged that the notice of default and acceleration "would have a material adverse impact" on the business, its financial condition, cash flow, and operating results."

The impact has already been reflected in the company's stock price. In after-hours trading, shares of Iris Energy (IREN) fell 18% over the day and were trading at $1.65. On November 21, they hit an all-time low, down 94% from the all-time high of $24.8 in early trading in November 2021.

Iris has now reduced its production capacity by about 3.6 EH/s. The company said capacity is still about 2.4 EH/s, including 1.1 EH/s of operating equipment and 1.4 EH/s of units in transit or awaiting deployment.

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