By selling its flagship Helios mining operation and obtaining a $35 million loan from Galaxy, Argo Blockchain cuts its overall debt by $41 million.

Argo Blockchain, a cryptocurrency mining startup, has made the painful choice to sell its flagship mining facility Helios in order to survive the current bear market.

Argo Blockchain CEO Peter Wall formally confirmed on December 28 a contract to sell the Helios facility for $65 million to Mike Novogratz’s crypto investment business Galaxy Digital. It has already begun to cash in its mined Bitcoin in order to lower its loan to Galaxy.

In addition, Galaxy will give Argo a fresh $35 million equipment finance loan to assist the distressed miner in repaying its debt. “We utilized the revenues of that transaction to pay off the debt we owed to NYDIG and a minor bit to another secured lender,” Wall explained.

The new deals are intended to lower their overall debt by $41 million while also improving liquidity and operational structure, allowing the company to continue mining activities, according to the CEO.

Wall stated that the agreement was the “only possible road ahead” in the bear market, which was exacerbated by high energy costs and the low Bitcoin price.

The agreement

The CEO also stated that, despite the sale of Helios, Argo has not sold any of its mining machines. “Those will continue to mine at Helios,” Wall said, adding that they have also inked an agreement to keep its mining machines working at Helios. He stated, “

“Staying at Helios will also allow us to continue to access power through the Texas grid and participate in the ancillary services, which are provided by Ercot.”

The agreement comes barely six months after they debuted Helios in May 2022. Helios, located in Dickens County, is the largest Argo mining plant, with a capacity of 200 megawatts (MW). Another Argo facility, Baie Comeau, runs at roughly 15 MW.

The announcement comes as Argo continues to struggle to acquire finance after failing to collect $27 million through subscriptions for ordinary shares. Argo said in October that it was in danger of going out of business owing to a lack of new funding. Argo reported in mid-December that it was discussing the sale of its assets and attempting to “engage in an equipment financing deal” in order to avoid bankruptcy.