Coinbase Prime facilitates $450M crypto-collateralized loan for Marathon Digital

Marathon Digital Holdings just turned its Bitcoin stash into a $600 million credit line. The Bitcoin miner secured two term loans collateralized by 18,750 BTC, with Coinbase Credit supplying $450 million and Two Prime Lending kicking in another $300 million at a fixed 7.65% interest rate.

The deal, announced on August 4, is one of the largest crypto-collateralized lending arrangements to date for a publicly traded company.

How the deal is structured

The total facilities amount to $750 million. That figure includes refinancing a $150 million existing credit line alongside $300 million in fresh capital.

MARA pledged 18,750 BTC for the borrowing. At the time of the transaction, those coins carried a market value of approximately $1.2 billion, representing about 53% of the company’s total holdings of 35,577 BTC as of June 30.

Both loans mature in August 2028. The Coinbase facility comes with an option for a one-year extension, giving MARA some breathing room if market conditions shift. Ongoing margin coverage requirements are baked into the agreements, which means MARA will need to keep a close eye on Bitcoin’s price relative to its loan-to-value ratios.

Where the money is going

The funds aren’t sitting in a treasury account collecting dust. MARA earmarked the capital for general corporate purposes, but the big-ticket item is its planned acquisition of Long Ridge Energy & Power, a deal projected at roughly $1.5 billion in enterprise value.

Long Ridge operates a 505 MW gas-fired power plant. The Long Ridge facility could also support high-performance computing workloads, giving the company optionality in a market where AI data center demand is surging alongside crypto mining.

The bigger picture for crypto-collateralized lending

Coinbase stepping up as a primary lender in a deal this size signals that institutional crypto lending has entered a new phase. Two Prime’s willingness to lock in a fixed 7.65% interest rate on $300 million suggests that professional credit markets are increasingly comfortable pricing Bitcoin-backed risk.

The loan-to-value ratio here is worth noting. MARA borrowed $600 million against $1.2 billion in Bitcoin, a roughly 50% LTV. Bitcoin would need to decline substantially from current levels before MARA faces pressure to post additional collateral or reduce its position.

If Bitcoin enters a prolonged downturn, MARA could find itself in the uncomfortable position of needing to pledge additional collateral or, in a worst-case scenario, having its Bitcoin liquidated by lenders. With 53% of its holdings already pledged, the margin for error is thinner than it might appear at first glance.

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