PowerCompute Swaps $18M Debt for Bitcoin-Backed Loan at 2% APR

Woofun AI reports that PowerCompute has executed a strategic debt consolidation, merging three existing obligations totaling $18 million into a single Bitcoin-backed credit facility provided by Arch Lending. This restructuring centralizes the company's liabilities under one lender, replacing fragmented financing arrangements with a unified collateralized structure.

The transaction timeline began with an initial bridge loan agreement signed on July 27, followed by the formalization of the new facility on Monday, as detailed in a Wednesday press release shared publicly. To secure this financing, PowerCompute pledged 307 Bitcoin (BTC) from its treasury holdings, establishing a direct link between its digital asset reserves and its corporate debt obligations.

Per Woofun AI, the refinanced portfolio previously consisted of an $11 million loan from Galaxy Digital, a $5 million loan from SE and AJ Liebel for a 15-megawatt Oklahoma facility, and a $2 million Liebel loan for an 11-megawatt Mississippi facility. By consolidating these distinct instruments, the company streamlined its asset acquisition financing while maintaining exposure to its underlying mining infrastructure investments.

The new facility carries an initial interest rate of 2% APR, a stark reduction from the 12% rate applied to the $7 million in combined Liebel loans. This rate resets at each 30-day rollover based on prevailing market conditions, introducing variable cost risks if Bitcoin’s price declines and triggers additional collateral requirements.