Argo blockchain stock jumps 102% as bankruptcy risk averted

Argo Blockchain (NASDAQ: ARBK) (LSE: ARB) shares are up more than 100% today after the company secured a $100 million deal with Galaxy Digital.

Argo was headed for bankruptcy after it published a draft bankruptcy filing admitting that it was running out of money. Bitcoin Miners have been hit hard in 2022 by a price collapse.

Argo Blockchain Completes Massive $100 Million Deal

At the time of writing, Argo stock was is trading at 6.63 GBP 3.66 on the LSE and above $0.6476 on the NASDAQ.

Argo blockchain stock jumps 102% as bankruptcy risk averts - 1
Ergo Blockchain 1 week chart. Source: LSE

Argo Blockchain was in dire financial straits and admitted it would be bankrupt by the new year. A statement from company officials revealed that there was no money in the treasury to support the ongoing works.

Argo operates three crypto mining facilities in Dickens County, Texas, Baie in Quebec, Canada, and Mirabel, Quebec.

On 13 December the Argo revealed that it was in negotiation with a third party which will buy certain properties and also include “Equipment Financing Transaction.” However, Argo cautioned that there is no assurance that the company can survive. filing chapter 11 bankruptcy, Even though these talks have gone on.

Fast forward to December 28, and the financially constrained company has managed to secure financing, revealed to be a third party Galaxy Digital.

The crypto mining company’s share price skyrocketed by over 102% following the announcement.

As previously mentioned, Argo will sell its crypto mining facility located in Texas to Helios for $65 million. In addition, they will receive a $35 million loan from Galaxy Digital to refinance their asset-backed loans.

Through this deal, Argo Blockchain will be able to retain its 2.5 exohash of computing power to mine bitcoin.

Blood bath for bitcoin mining firms

Argo escaped bankruptcy by a whisker as other companies in the sector have either gone under or are on their way out. Massive Bitcoin Miner Core Scientific Also Said It Could Happen run out of money By the end of 2022.

Compute North, another crypto-mining data center company, filed for Chapter 11 bankruptcy In September 2022. The company was deeply in debt, owing more than $500 million to at least 190 debtors.

The state of the crypto landscape is such that the bear market declines. The income from mining is not enough, at current bitcoin pricesTo maintain mining operations, given the high cost of production.

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