CoinDesk Podcast Network
THE MINING POD: CleanSpark’s $650M Convert Deal
Dec 17, 2024
Zach Bradford, CEO of CleanSpark, and Gary Vecchiarelli, CFO, discuss their innovative $650 million convertible note structure designed to enhance Bitcoin mining operations. They delve into why they opted against purchasing Bitcoin directly, the strategy behind their 0% interest deal, and the need for efficient capital deployment. The conversation also covers the growing role of institutional investors in the crypto space and what metrics will be key to watch in 2025, revealing insights into CleanSpark's vision for future expansion.
46:37
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Quick takeaways
- CleanSpark's $650 million convertible note features a 0% coupon rate, reflecting a growing trend among Bitcoin miners for flexible financing.
- The company is prioritizing operational growth and infrastructure enhancements over immediate Bitcoin purchases, aiming to achieve a hash rate of 50 EH/s.
Deep dives
Understanding Convertible Notes
Convertible notes are becoming increasingly popular in the Bitcoin mining sector, with companies like CleanSpark utilizing them to fund investment strategies. CleanSpark's recent convertible note issuance of $650 million features a unique 0% coupon rate, which other competitors in the market have been moving towards as well. Unlike other methods like equity dilutions or ATMs, convertible notes offer a flexible financing option that allows a company to raise capital while preserving ownership. This setup provides institutional investors with the benefit of downside protection compared to common shareholders, while also minimizing dilution for current equity holders.
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