Cryptocurrency mining firm Argo Blockchain has taken a difficult decision to sell its flagship mining facility Helios in order to survive the ongoing bear market.
Argo Blockchain CEO Peter Wall officially announced on Dec. 28 a deal with Mike Novogratz’s crypto investment firm Galaxy Digital to sell the Helios facility for $65 million. Argo has already been cashing its mined Bitcoin (BTC) to reduce the loan to Galaxy.
Additionally, Galaxy will also provide Argo with a new $35 million equipment finance loan to help the troubled miner reduce its debt. “We’ve used the proceeds of that sale in a new Galaxy loan to pay off the debt that we owed to NYDIG and a tiny bit to another secured lender,” Wall noted.
The new transactions aim to reduce Argo’s total debt by $41 million and improve liquidity and operating structure, allowing the firm to continue its mining operations, the CEO said.
Wall noted that the deal was the “only viable path forward” through the bear market amid pressure from high energy costs coupled with the low Bitcoin price.
The CEO also emphasized that despite Argo selling Helios, the firm has not sold any of its mining machines. “Those are going to continue to mine at Helios facility,” Wall said, adding that Argo has also signed an agreement to keep running their mining machines at Helios. He stated:
“Staying at Helios will also allow us to continue to access power through the Texas grid and participate in the ancillary services, which are provided by Ercot.”
The deal comes just six months after Argo officially launched Helios in May 2022. Located in Dickens County, Helios facility is the largest Argo mining facility, supporting 200 megawatts (MW) of electricity. In comparison, another Argo facility, Baie Comeau, operates around 15 MW.
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The news comes amid Argo’s struggle to secure financing after failing to raise $27 million via subscription for ordinary shares. In October, Argo said that it was at risk of closing due to failing to raise new financing. In mid-December, Argo announced that it was negotiating to sell its assets and trying to “engage in an equipment financing transaction” in order to avoid filing for bankruptcy.
Argo did not immediately respond to Cointelegraph’s request for comment.