Argo Blockchain Continues to Avoid Bankruptcy with $100 Million Bailout

The recent turmoil in the cryptocurrency market has sent severe shock waves to the mining industry with low crypto values ​​and rising energy costs, creating an unstable situation for several leading mining firms to continue their operations.

The past two months have been tough for leading Bitcoin mining company Argo blockchain, with growing concerns regarding the operation of its mining facilities due to insufficient cash. Moreover, the sharp decline of over 40% in ARB’s share price has stressed investors about the company’s future potential and expansion.

However, the mining company expresses its decisive steps to avoid bankruptcy by halting its shares on the London Stock Exchange (ARB) and Nasdaq (ARBK). In addition, the firm continues to sell its mining facilities to Galaxy Digital to continue cash flow into the firm.

Galaxy Digital Becomes a Messiah to Eliminate Argo Blockchain’s Bankruptcy Risk!

As the trend of bankruptcies continues to grow after the sudden demise of the huge crypto exchange FTX, Argo Blockchain becomes the current target to continue the rally, which could result in a severe price drop for the Bitcoin market. According to a recent report, Argo Blockchain is taking a step ahead to avoid the risk of bankruptcy by seeking help from Mike Novogratz’s crypto-focused financial services firm, Galaxy Digital.

In a statement, Argo Blockchain agrees to sell its largest mining facility, i.e. the Helios mining facility in Dickens Country, Texas, to Galaxy Digital for $65 million. Furthermore, the mining company is seeking a $35 million loan from the crypto firm to continue financing the mining facility. Argo Blockchain stated that the loan would be secured by their mining equipment.

Argo CEO Peter said: “Over the past few months we have been looking for a way to continue mining through the bear market, reduce our debt load and maintain access to the unique power grid in Texas. This deal with Galaxy achieves all of these goals and it allows us live to fight another day.”

Argo in a Do or Die situation

Selling Argo’s largest mining facility has been a tough decision for the crypto giant as it has up to 180 megawatts (MW) of power capacity and will be Galaxy Digital’s flagship mining operation upon completion of the deal. However, the move was necessary to retain investors in the firm, as the deal will boost Argo’s balance sheet and eliminate the risk of bankruptcy after a $27 million deal collapsed in October.

Amanda Fabiano, Head of Mining at Galaxy, stated: “Quality infrastructure and access to low-cost energy are the cornerstones of a successful mining operation, making the acquisition of Helios an incredible milestone for the growth of Galaxy’s mining business.”

The Bitcoin mining giant previously promised its investors that it was looking for more negotiations with crypto firms to sell its mining facilities and assets and conduct steady fundraising to avoid a Chapter 11 bankruptcy filing. It should be noted that Argo Blockchain signed a two-year hosting agreement with Galaxy to secure a place for their computers to continue mining at the Helios facility.

Chris Ferraro, president and chief investment officer of Galaxy Digital, said: “We were in a position to completely solve the problem for Argo while accelerating the expansion of our own mining capabilities.”

Galaxy Digital sees this as a bear market opportunity to stand out amid the market downturn, as Helios’ mining facility will become the dominant choice Galaxy made this year, pushing the firm to become one of the most competitive crypto firms in the crypto world.

Ferraro said: “Galaxy hopes to be one of the most trusted nodes in the decentralized future. The acquisition of Helios represents a new stage in our two-year journey in bitcoin mining that increases our operating scale and breadth of solutions, creating sustainable value for the largest decentralized digital asset network and its shareholders.”