Bitfarms Ltd., a global Bitcoin self-mining company, has modified its loan agreement with BlockFi Lending LLC, to settle all outstanding principal and interest due totaling $21 million for a single cash payment of $7.75 million.

“Combined with the earlier restructuring and elimination of our capital expenditure obligations in December, this successful negotiation and settlement furthers our initiatives to reduce indebtedness, enhance liquidity and increase financial flexibility in line with today’s market conditions,” said Jeff Lucas, CFO of Bitfarms. “Lowering our debt nearly 85 percent from a high of $165 million in June 2022 to $25 million today has significantly decreased principal and interest obligations, which boosts our cash flow and positions us well for future growth.”

“Our remaining debt, mostly secured by new, high efficiency mining equipment in Quebec, matures on or before February 2024, enabling us to be debt free before the next halving event expected in May 2024,” added Lucas.

The BlockFi Loan Facility Repayment

On Feb. 18, 2022, Bitfarms’ wholly owned U.S.-based subsidiary, Backbone Mining Solutions, Inc. (BMS), entered into a $32 million equipment financing facility with BlockFi. BMS owns and operates Bitfarms’ 20-megawatt active crypto mining facilities in the State of Washington. At Jan. 31, 2023, outstanding principal and accrued interest on the BlockFi equipment loan facility totaled $21 million. On Feb. 8, 2023, BlockFi retired the BMS loan in its entirety and discharged all further obligations for consideration of $7.75 million in cash. Subsequent to the settlement, all of BMS’ assets, including 6,100 miners, are unencumbered.