Bit Digital pledged 49,000 LsETH, representing 74% of its staked Ethereum position, as collateral for a $50 million loan from Galaxy Digital at an interest rate of 5.45%. The financing enabled the company to fund WhiteFiber, its majority-owned AI infrastructure subsidiary, without selling ETH or issuing new shares, but tied a portion of its treasury to loan collateral. Bit Digital recorded a non-cash impairment of $46 million on its LsETH holdings in the second quarter without selling any Ethereum. Galaxy’s master loan agreement allows partial liquidation of collateral if Bit Digital fails to meet a margin call within 24 hours, or nine hours under urgent threshold conditions.
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