Borrowing Instead of Selling Bitcoin: Miner MARA Opens the Era of Secured Credit

Borrowing without selling. MARA Holdings has secured $600 million in new financing without selling its BTC. The miner has pledged 18,750 bitcoins, valued at approximately $1.2 billion at the time of the transaction, to Coinbase Credit and Two Prime Lending. This allows the company to maintain its exposure to bitcoin while recovering liquidity to finance its investments, including the acquisition of Long Ridge Energy & Power. For Two Prime, this operation confirms that BTC-backed lending is scaling up and entering its "institutional era".

Key Points {#h-key-points}

• MARA and Riot have secured credit lines of $200 million and $100 million backed by their bitcoins from Coinbase.
• Cantor Fitzgerald has launched a BTC-backed financing activity with an initial capacity of $2 billion.
• Borrowing avoids taxable disposals and shareholder dilution, with loan-to-value ratios between 30% and 50%.
• A decline in bitcoin could trigger a margin call, followed by the liquidation of part of the collateral.

The transaction concluded on August 4 includes two distinct facilities. Coinbase Credit provides an additional $300 million and refinances an existing line of $150 million. Its facility thus reaches $450 million, with a variable rate corresponding to the median federal funds rate plus 3.875 percentage points.

Two Prime simultaneously provides a $300 million loan, fully drawn, with a fixed rate of 7.65%. Both agreements mature in August 2028, although the Coinbase agreement includes a possible automatic one-year extension.

In total, MARA thus has $600 million in new financing and refinances $150 million of existing debt. The 18,750 BTC pledged as collateral represented approximately $1.2 billion at signing. They correspond to nearly 53% of the 35,577 bitcoins held by the company at the end of June.

The funds are intended for general corporate needs, including financing part of the acquisition of Long Ridge, a company involved in gas and power production. This operation aims to enhance MARA's energy capabilities for mining, as well as for artificial intelligence and high-performance computing.

The secured credit backed by Bitcoin is changing dimensions {#h-secured-credit-backed-by-bitcoin-is-changing-dimensions}

For Alexander Blume, CEO of Two Prime, bitcoin-backed loans are maturing. Lenders are now able to offer larger amounts, longer terms, and conditions tailored to the specific needs of publicly traded companies.

The calculation is simple: borrowing against BTC allows for liquidity without selling the asset or giving up potential future gains. The company also avoids financing its investments solely through the issuance of new shares, which would dilute its shareholders.

However, this strategy shifts the risk to the collateral. MARA's contracts require maintaining a minimum level of collateral. If bitcoin falls below certain thresholds, the company will need to provide additional BTC or reduce its borrowing. In case of failure, Coinbase or Two Prime may liquidate the pledged bitcoins.

The structures are becoming more institutional, with clear rules on custody, margin calls, and liquidations. Other players, including Ledn and Kraken, are simultaneously developing financing and securitized products backed by cryptocurrencies.

MARA is thus transforming more than half of its Bitcoin treasury into financial leverage. The loan avoids an immediate sale, but now places a significant portion of its reserves under the threat of liquidation if the market drops. BTC is becoming a true corporate financing asset, with the advantages and constraints of traditional collateral.

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