Another bitcoin mining company is dealing with financial issues as Iris Energy’s Form 6-K filing with the U.S. Securities and Exchange Commission (SEC) shows the company could face default on two loans. Iris Energy’s Form 6-K filing explains to the SEC that the firm “received a notice from its lender alleging the occurrence of an event of default and acceleration under the respective limited recourse equipment financing facilities.”
Bitcoin mining company Iris Energy faces default on 2 loans
On November 7, 2022, bitcoin mining firm Iris Energy updated investors about its October operations, and the company noted that it currently operates a hash rate of around 3.9 exhash per second (EH/s). The bitcoin mining company also said that its “Mackenzie expansion” in British Columbia, Canada, from 50 megawatts (MW) to 80 megawatts “is on track for energy by the end of the fourth quarter of 2022.” In addition, the firm’s Childress facility in Texas is still in the construction and energy phase and continues to operate on that end.
However, a Form 6-K SEC filing registered in November indicates that two lenders are alleging the company defaulted on $103 million in equipment loans. The loans are being held by two special-purpose vehicles (SPV) and the lenders have sent a “purported acceleration notice” for the alleged defaults. Iris Energy said that a large fraction of its exahash is unaffected by the SPV’s purported acceleration notice. Iris Energy’s SEC filing states:
2.4 EH/s of miners and all data center capacity and development pipelines of the Group are unaffected by limited recourse equipment financing arrangements or alleged acceleration notices.
The bitcoin miner’s filing with the U.S. regulator follows other mining companies dealing with financial issues. For instance, at the end of September, Bitcoin.com News reported on Compute North filing for bankruptcy protection. Additionally, Core Scientific told the U.S. SEC that it was having financial difficulties as Core Scientific’s “operating performance and liquidity have been severely impacted by the prolonged decrease in the price of bitcoin.”
As far as the Iris Energy filing is concerned, one SPV says it is owed $71 million, and another claims that Iris Energy is owed $32 million. Iris Energy said it has data center capacity available and it “explores opportunities to use this capacity to either host third-party miners or to self-mining using additional miners available with the company.” Continues to find or chooses to buy.”
Iris Energy shares (Nasdaq: IREN) have lost 19.60% against the U.S. dollar during the last five days. A myriad of bitcoin mining companies have also seen shares slide 80% to 90% during the past 12 months and year-to-date, IREN is down 81.68% against the greenback.
