MARA Holdings sold most of its mined Bitcoin and pledged over half its reserves as collateral for $600 million in loans, fueling an AI data center acquisition while leaving key collateral and margin-call details undisclosed
MARA Holdings has committed more than half of its Bitcoin reserves as collateral to secure $600 million in new loans, aiming to finance the acquisition of Long Ridge, a power-generation site the company plans to convert into an AI and high-performance computing data center. The move comes after MARA sold 2,213 BTC-over 91% of the Bitcoin it mined in the second quarter-raising questions about the company's liquidity and risk exposure as it pivots from mining to infrastructure for artificial intelligence.
Collateral Structure and Uncertainties
According to MARA's latest quarterly filing, the company pledged 18,750 BTC as collateral across two loan facilities finalized on August 4. These facilities, totaling $750 million, include a $450 million arrangement with Coinbase-of which $300 million is new borrowing and $150 million is a refinancing-and a separate $300 million loan from Two Prime. The pledged Bitcoin represents 52.7% of the 35,577 BTC MARA reported holding as of June 30, but the figures span different dates, making it unclear how much Bitcoin remains unrestricted after the loans closed. At quarter-end, MARA classified 26,307 BTC as unrestricted, 4,742 BTC as loaned, and 4,528 BTC as pledged collateral, but did not clarify how these pools overlap with the new 18,750 BTC pledge.
Margin Call and Liquidation Risks
Both loan agreements require MARA to maintain sufficient Bitcoin collateral, with the risk of default and forced liquidation if collateral levels fall below undisclosed thresholds. The company has not revealed the specific maintenance ratios, margin-call triggers, cure periods, or how collateral is allocated between lenders. This lack of transparency means investors and counterparties cannot determine the Bitcoin price at which MARA would face a margin call or forced sale of its pledged assets. The Coinbase facility carries a floating interest rate tied to the federal funds target range plus 3.875%, while the Two Prime loan has a fixed 7.65% rate; both mature in August 2028, with the Coinbase loan offering an automatic one-year extension unless canceled.
AI Ambitions and Regulatory Hurdles
The Long Ridge acquisition remains subject to regulatory approval. While the Federal Trade Commission granted early termination of the antitrust waiting period in June, MARA disclosed in August that approval from the Federal Energy Regulatory Commission was still pending. The acquisition agreement includes a November 30 outside date, extendable to June 2027 if regulatory conditions are not met, and could require MARA to pay a $75 million termination fee under certain circumstances. Management has set a goal of securing at least one AI or high-performance computing lease by year-end, but has not announced any signed tenants for Long Ridge.
Market Context and Comparable Risks
MARA's strategy of leveraging Bitcoin reserves for infrastructure expansion echoes moves by other mining firms. For example, American Bitcoin recently pledged a significant portion of its BTC holdings as collateral for mining equipment, exposing itself to market volatility and operational risks as redemption windows approach. This trend highlights how miners are increasingly using their Bitcoin treasuries to bridge capital needs amid shifting market conditions and the search for new revenue streams. A recent EgonCoin report on American Bitcoin's collateral strategy illustrates the broader industry pattern of balancing liquidity, risk, and growth ambitions.
For the second quarter, MARA reported $174.9 million in revenue but posted a $611.3 million net loss, including a $342.7 million fair-value loss on its Bitcoin holdings. The company also disclosed $471.3 million in net cash used for operating activities in the first half of 2026, underscoring the financial pressures facing miners as they navigate volatile markets and capital-intensive expansion plans.
When miners use Bitcoin as collateral for loans, they introduce new risks tied to both market price and lender requirements. If Bitcoin's price drops sharply, borrowers may be forced to post additional collateral or face liquidation, potentially compounding losses. The lack of clear disclosure around margin-call thresholds and collateral allocation makes it difficult for investors to assess the true risk profile of these arrangements. As more mining companies pursue AI and data center ventures, the interplay between crypto treasury management and infrastructure investment will remain a key area of scrutiny for both markets and regulators.
