Bitcoin miner Iris Energy unplugs hardware collateralizing over $100 million in loans

Bitcoin miner Iris Energy unplugs hardware collateralizing over 0 million in loans

Iris Energy’s unplugged miners were used as collateral for over $100 million in debt after receiving a default notice from their lender.

The machines accounted for much of the company’s hash rate and freed up around 90 megawatts of power capacity, which the company now plans to use to explore other opportunities.

Bitcoin miner Iris Energy has taken the clear majority of its miners offline in response to a notice of default over approximately $107.8 million in loans they had taken out. However, the company said its data center capacity and development pipeline “will not be affected” by the move, according to a filing with the US Securities and Exchange Commission on Monday. Approximately 90 megawatts of capacity were released at a time when equipment prices were falling.

“The group continues to evaluate opportunities to leverage its available data center capacity, recognizing the current shortage of data center hosting capacity in the industry and the prospect of upfront payments of $75 million already made to Bitmain for an additional 7.5 EH/s of miners contracted for further self-mining,” Iris said in a statement.

The company had previously stated that given the current mining economy, the machines needed to generate more cash to repay the loans and were generating gross profits of approximately $2 million in BTC per month versus $7 million in debt obligations. Earlier this month, Iris received a reminder from her lender and is waiting for the machines to be recalled.

After shutting down about 3.6 EH/s of machines, the company said its computing capacity is now about 2.4 EH/s, with 1.3 EH/s of miners on the move or in use and 1, 1 EH/s of machines in operation. 

The company further stated that the facilities were “specifically organized for prudent risk management to protect the underlying data center and business infrastructure created by the group” (i.e., without any guarantee from the parent company and recourse to any other entity in the group). Iris had $53 million in cash and cash equivalents as of October 31.

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