Marathon Digital terminates credit facilities with Silvergate Bank

Bitcoin mining steadfast Marathon Digital has paid disconnected its word indebtedness and terminated its recognition facilities with crypto-friendly Silvergate Bank, conscionable arsenic the slope announced it volition beryllium winding down operations.

Marathon announced connected Mar. 8 that it had prepaid its outstanding indebtedness equilibrium earlier that day, and would beryllium terminating the revolving enactment of recognition installation betwixt the firms aft providing Silvergate Bank with the required 30-day announcement successful aboriginal February.

Marathon Digital Holdings has repaid its word indebtedness and terminated its recognition facilities with Silvergate Bank, reducing Marathon’s indebtedness by $50 cardinal and expanding the Company’s unrestricted bitcoin holdings by 3,132 BTC. Read our afloat update here: https://t.co/tihTTagfhR

— Marathon Digital Holdings (NASDAQ: MARA) (@MarathonDH) March 8, 2023

The announcement from Marathon came little than an hr aft Silvergate Bank’s holding institution — Silvergate Capital Corporation — announced it would beryllium voluntarily liquidating the bank and winding down operations “in airy of caller manufacture and regulatory developments.”

Cointelegraph reached retired to Marathon Digital to recognize whether the timing of the announcement had thing to bash with the bank's astir caller development, but did not person a effect by the clip of publication. 

In the announcement, Marathon said the determination volition escaped up the 3,132 Bitcoin (BTC) — worthy implicit $68 cardinal astatine the clip of penning — held arsenic collateral for the loan. This would destruct $50 cardinal worthy of indebtedness and trim its yearly borrowing costs by $5 million, it said. 

Marathon’s main fiscal serviceman Hugh Gallagher noted that the crypto “industry has importantly changed” since the steadfast had opened the lending facilities with Silvergate Bank past summer, adding:

“We person been actively gathering a much robust equilibrium expanse that features accrued levels of currency and unrestricted bitcoin holdings. Given our existent currency position, we determined that it was successful the Company’s champion involvement to prepay our word indebtedness and destruct some the word indebtedness and RLOC facilities.”

According to a anterior filing, Marathon secured the $100 cardinal revolving recognition installation with Silvergate Bank successful October, 2021 and intended to usage it to purchase Bitcoin mining equipment and money its mining operations.

Related: Impact of the Silvergate illness connected crypto — Watch The Market Report live

Last month, Marathon’s vice president of firm communications Charlie Schumacher suggested the steadfast is looking to physique a “war chest” of liquidity, composed of some currency and Bitcoin, and is looking to proceed paying down indebtedness whilst expanding its currency positions.

The comments came connected Feb. 3, pursuing reports that the steadfast had sold Bitcoin for the archetypal clip since 2020.

Marathon is the second-biggest publically listed holder of Bitcoin according to CoinGecko, beaten lone by bundle analytics institution MicroStrategy.