Iris Energy Uses Inactive Miners As Collateral For A Loan Of Over $100 Million

Iris Energy has disconnected the bulk of its miners after receiving a notice of delinquency for debts totaling roughly $107.8 million that they were securing.

However, according to a document made on Monday with the U.S. Securities and Exchange Commission, the company’s data center capacity and development pipeline would be unaffected by the change. A 90 megawatts of capacity were made available when equipment prices were falling rapidly. The company said in the filing:

“As a result of the termination of hosting arrangements with Non-Recourse SPV 2 and Non-Recourse SPV 3, the Group continues to explore opportunities to utilize its available data center capacity, recognizing the current scarcity of industry hosting data center capacity, and the prospect of utilizing $75 million of prepayments already made to Bitmain in respect of an additional 7.5 EH/s of contracted miners for further self-mining.”

Iris Energy expects its lender to call back the machines after serving it with a default notice earlier this month.

It had previously claimed that, given the economics of mining, the equipment wasn’t making enough money to cover the loans, with about $2 million in Bitcoin in monthly gross profit being generated compared to the $7 million in debt obligations.

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