PowerCompute (a Bitcoin treasury and mining company) has drawn market attention after refinancing three existing loans into a single $18.13 million “collar loan” provided by Arch Lending at an annual interest rate of 2%, collateralized by 307 BTC (92.33% LTV); the first monthly reset date is September 2.
September 2 Reset Mechanism: $58,860 Floor, $66,370 Ceiling
According to the filed reset agreement, the process on September 2 is as follows: a reference price check will be conducted at 8 a.m. Eastern Time; PowerCompute must accept Arch’s new offer by 5 p.m. Eastern Time or choose to terminate the trade. For any new trade period, the floor and ceiling will be re-established based on the post-reset reference price, and the annual fee rate will also be re-quoted. If there is no response, the offer will be deemed to have automatically expired rather than constituting a default.
Three Settlement Scenarios: Below the Floor, Within the Collar, Above the Ceiling
According to the executed agreement, the three settlement scenarios on September 2 are as follows:
Price below $58,860: Arch may retain all pledged BTC as full repayment without recourse, or Arch may repay the loan and recover all BTC. If an extension is chosen, the quote difference must be eliminated within the 24-hour cure period through additional BTC, repayment of principal, or a combination of both.
Price between $58,860 and $66,370: PowerCompute may repay the secured debt, including accrued interest, and recover the collateral, or extend the loan under the terms of the new offer.
Price above $66,370: PowerCompute’s upside is capped; Arch receives the excess appreciation in the form of retained BTC or USD/USDC. If the loan is extended, the excess appreciation may be added to principal or reflected in the new ceiling and interest-rate quote.
Initial-Period Protections and Refinancing Background
The key protection in this refinancing structure is that during the initial period, before the September 2 reset, even if Bitcoin breaks through any price strike or LTV level, no margin call or liquidation will be triggered. This shifts the pressure from daily price volatility to a financing decision made once per month.
This refinancing replaced an $11 million Galaxy Digital loan with a 0% interest rate and two Liebel loans totaling $7 million with a 12% interest rate. The new 2% initial interest rate applies to the entire $18.13 million financing facility, but the announcement’s comparison between the 12% and 2% rates covers only Liebel’s $7 million portion.
FAQ
When is the first reset date for PowerCompute’s 307 BTC collar loan?
According to documents PowerCompute filed with the SEC, the first monthly reset date for the $18.13 million collar loan collateralized by 307 BTC is September 2, 2026, and no margin call or liquidation will be triggered during the initial period before then.
What happens if Bitcoin falls below $58,860 on September 2?
Under the executed agreement, if the reference price on September 2 is below $58,860, Arch Lending may retain all pledged Bitcoin as full repayment without recourse. PowerCompute may also choose to provide additional Bitcoin or repay principal during the 24-hour cure period.
Which old loans did this refinancing replace?
According to the announcement filed by PowerCompute, this refinancing replaced an $11 million Galaxy Digital loan with a 0% interest rate and two Liebel loans totaling $7 million, bearing 12% interest. The new 2% annual interest rate applies to the entire $18.13 million financing facility.
