Quotes on Gryphon Digital Mining, which brands itself as a carbon-neutral Bitcoin miner, soared over 16% on Monday, October 28, following the company’s announcement of a debt restructuring agreement with the crypto bank Anchorage Digital to convert about two thirds of its debt into equity, with the remaining third payable over three years, and grant the bank a board seat.
Details
On Monday, Gryphon stock gained more than 16% on the Nasdaq to $0.71 per share before extending the gains in after-hours trading and premarket trading today, Tuesday, October 29, when it climbed another 5% to $0.75 per share.
Before the opening bell on Monday, Gryphon announced a debt restructuring agreement with the crypto bank Anchorage Digital. The miner’s remaining BTC304 debt to Anchorage was valued at about $18 million, based on the average Bitcoin price in September.
The parties agreed to split the debt into two parts. The first part — roughly $13 million — will convert into 8.3 million shares and 3.5 million pre-funded warrants at a price of $1.10 per share, representing a 100% premium to Gryphon’s 30-day average closing price, the company noted. The remaining $5 million in debt will have a three-year term, with interest payable only during this period. If the debt is not paid off by the end of the term, Anchorage Digital can convert the $5 million into equity as follows: 50% at $1.10 per share and 50% at $1.50 per share.
The crypto bank will also receive warrants to acquire 2 million shares at $1.50 per share and a seat on Gryphon’s board of directors, the Bitcoin miner added.
About Gryphon
Gryphon claims to be a carbon-neutral Bitcoin miner. In August, the company acquired power assets that use flared gas, a byproduct of oil extraction. According to its own estimates, this could generate up to $1 million in annual revenue. In mid-October, Gryphon provided an operating update for September, estimating that it mined about $1.16 million worth of Bitcoin in the period, based on an average Bitcoin price of $60,286 that month.
Recently, Gryphon has been focused on strengthening its team, as part of which Steve Gutterman was appointed CEO in mid-September. Less than a week ago, former CEO Robby Chang, who had been terminated as CEO and president of Gryphon “for cause,” filed a complaint in court against the company, although the nature of the claims was not disclosed.
Stock performance
Since the beginning of the year, Gryphon stock has lost nearly all its value, plummeting 92%. According to MarketWatch, the one analyst covering the company recommends holding the stock. The target price is $16 per share, 22 times the current price.
