Maple, a crypto lending platform, has set up a $300 million credit fund for Bitcoin miners. The interest rate on these loans can be as high as 20%.
As more mining firms come under stress, a new fund has been launched to provide them with support. Bitcoin's low prices, soaring energy costs and network competition have all contributed to miners' revenues reaching a two-year low. This has made it difficult for them to raise funds from traditional capital markets and other crypto-native sources.
Maple, which was previously known as Maple Finance, was founded in Sydney in 2019. In May 2021, it launched its first lending pool. Most of the team has since relocated to Miami, Florida. Through its newly established fund, the lender will offer secured debt financing to large-scale Bitcoin miners and mining infrastructure providers in North America.
Icebreaker Finance, a financial services firm based in Sydney, will manage and administer the loans on Maple's platform, according to Sidney Powell, CEO of Maple. This arrangement will give Icebreaker a chance to expand its services into the Canadian market.
Icebreaker's CEO, Glyn Jones, has announced that the company's fund will be securing loans with a mix of Bitcoin mining rigs, power assets and tokens. Jones stated that digital assets will form a relatively small portion of the collateral for these loans, which will have a tenor of 12 to 18 months and interest rates ranging between 15% and 20%. Borrowers' credit quality will be determined based on financial performance, balance sheet strength, treasury and energy risk management expertise and operational efficiency.
According to Powell, capital allocators for the new fund will be able to use the platform's on-chain lending vehicle to get better insight into the loan terms offered by crypto lenders. This will allow for better price discovery.
Maple is one of the leading crypto lending platforms in the DeFi space. The company has issued close to $1.8 billion in loans and holds a 50% share of the market, as measured by total loans outstanding across institutional DeFi lending platforms.
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