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ALBANY, N.Y. - Soluna Holdings, Inc. (NASDAQ: SLNH), known for developing green data centers, has secured a $5 million loan facility from Galaxy Digital (TSX: GLXY), a $4.17 billion market cap company specializing in digital asset and blockchain technology services. According to InvestingPro data, Galaxy Digital maintains strong liquidity with a current ratio of 1.85 and trades at an attractive P/E ratio of 5.75. The five-year loan agreement emphasizes the project-level cash flow strength and Soluna’s capacity to attract institutional financing.
The loan, which provides Soluna with additional capital, is secured against the assets at the project level and offers limited recourse to the parent company. Soluna’s CEO, John Belizaire, remarked on the significance of the financing, stating it reflects investor confidence in the company’s business strategy and the value of its assets. He highlighted that the deal allows for accelerated execution without shareholder dilution.
Max Bareiss, Head of Lending at Galaxy, expressed the company’s enthusiasm for supporting Soluna and confidence in its growth potential. The loan is characterized as non-dilutive debt financing, meaning it does not involve giving up any equity in the company.
Legal counsel for the transaction was provided by Nixon Peabody LLP for Soluna and Orrick, Herrington & Sutcliffe LLP for Galaxy Digital.
This financial move is part of Soluna’s ongoing efforts to expand its project development and deliver sustainable computing solutions. The company is focused on harnessing renewable energy for high-performance computing applications such as Bitcoin mining and AI, with the aim of making renewable energy a more dominant force in the global energy landscape. Galaxy Digital’s involvement comes at an interesting time, as InvestingPro data shows the company’s stock has experienced a -30.57% YTD return, though analysts maintain optimistic price targets. Subscribers can access 10+ additional ProTips and comprehensive financial metrics for both companies.
Soluna’s proprietary software, MaestroOS™, is designed to contribute to a greener grid by optimizing the use of surplus renewable energy for computing tasks, offering a cost-effective and sustainable solution while aiming to generate superior returns.
The information disclosed in this article is based on a press release statement from Soluna Holdings, Inc.
In other recent news, Galaxy Digital has announced a partnership with BitGo Trust to provide blockchain staking services, despite an ongoing legal dispute between the two companies. Galaxy Digital’s staking and validator services, which manage over $4 billion in staked crypto assets, will now be available to BitGo’s institutional clients. This collaboration continues even after Galaxy Digital withdrew from an acquisition deal with BitGo earlier this year, leading to a $100 million lawsuit from BitGo for an alleged breach of their 2021 merger agreement. Both companies have expressed a commitment to advancing digital asset adoption and maintaining their strategic collaboration, viewing the legal proceedings as a separate issue.
The partnership allows investors to earn rewards from staking while using their assets as collateral for loans and trading on Galaxy’s platform. Galaxy Digital has been expanding its non-custodial staking infrastructure, including acquiring blockchain node operator CryptoManufaktur last year. Zane Glauber, head of Galaxy’s Blockchain Infrastructure team, highlighted the benefits of combining custodial services with Galaxy’s trading environment, which allows assets in custody to be used as collateral. This move is seen as part of a broader trend under the current U.S. administration, which is considered pro-crypto, potentially paving the way for staking to be included in exchange-traded funds.
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