Marathon to Issue Debt for $500mln for Purchasing Bitcoin & Mining Machines

Marathon Digital, one of the top Bitcoin mining companies in the United States, has stated that it intends to borrow money from the debt market in order to purchase bitcoin and mining equipment.

Senior convertible notes with interest payable semi-annually and maturing on December 1, 2026, were issued by the company on Monday, according to an announcement. The notes will be used to raise $500 million, according to the statement.

Marathon stated that it intends to use the net proceeds for a variety of purposes, including “the acquisition of bitcoin or bitcoin mining equipment.”

Even though it is still only a proposal at this point, the initiative is the latest attempt by Bitcoin mining companies in North America to raise capital to fund capital investment and equipment expansion.

It also comes less than a month after Marathon announced that it had gotten a $100 million revolving line of credit from Silvergate Bank, which was backed by the company’s bitcoin and dollar assets.

Marathon, Riot, Bitfarms, Hut8, and Argo are just a few of the publicly traded North American Bitcoin mining businesses who have taken the policy of “hodling” practically all of the bitcoins they have mined so far this year, rather than liquidating them to fund capital expenditure.

As of the third quarter of 2013, only six significant Bitcoin mining companies in North America alone held more than 20,000 BTC, which was worth more than $1 billion at the time. They also continued to add their October monthly production to the remaining amount.

Argo, a London-based company that went public on the Nasdaq this year, also announced a potential public debt offering last week, with the goal of raising $57 million to fund the expansion of its Texas plant, which is now under construction. Marathon Mining Corporation is now the largest Bitcoin holder among the publicly traded Bitcoin mining businesses in North America.

Approximately 7,453 BTC ($490 million) was in its possession at the end of October, with 4,812 BTC ($317 million) having been purchased from the open market. The remaining holdings come entirely from the company’s mining operations.