TL;DR · 30-second read
The Short Version
Hut 8, a company that builds the huge, power-hungry buildings that run artificial intelligence, has lined up a $1.07 billion line of credit from 12 banks.
The surprising part is what much of it can be used for. Before a building goes up, power companies and equipment makers want deposits. This deal lets a bank’s written promise to pay stand in for that cash, so the company’s own money is not sitting idle.
It is a reminder that building for artificial intelligence costs serious money long before any computer is switched on.
Hut 8 Corp. (Nasdaq, TSX: HUT) announced on September 28, 2026 that it has closed a $1.07 billion, four-year senior secured revolving credit facility provided by a syndicate of 12 lenders. J.P. Morgan was lead left arranger, bookrunner and administrative agent; Citi, Goldman Sachs and Morgan Stanley were joint lead arrangers and joint bookrunners.
Borrowings are priced at the Secured Overnight Financing Rate (SOFR) plus 150 to 200 basis points depending on Hut 8’s debt-to-market-capitalization ratio, starting at SOFR plus 175. The facility carries a letter-of-credit sublimit of $1.07 billion intended to cover interconnection deposits and obligations to utilities and equipment vendors.
Executive Summary
A revolving credit facility, or revolver, works like a corporate credit card with a very high limit: the company can draw, repay and draw again for the life of the agreement. Hut 8’s new $1.07 billion revolver sits at the parent company level and is secured by company assets, and Hut 8 says it can be drawn as needed and repaid without prepayment penalties.
The detail that sets this facility apart is its letter-of-credit sublimit, which equals the full $1.07 billion. A letter of credit is a bank’s guarantee that it will pay a counterparty if the borrower does not. Hut 8 says it will use these to satisfy collateral requirements during site development, including grid interconnection deposits and obligations to utilities and equipment vendors, reducing the need to post cash.
The facility is designed to complement, not replace, the $7.5 billion of non-recourse, investment-grade project financing Hut 8 has already arranged for construction at its River Bend and Beacon Point AI data center campuses. The revolver covers the earlier, riskier stretch of a campus’s life; the project debt takes over once a site is further along.
The Letter-of-Credit Line Is the Real Story
Headlines naturally focus on the $1.07 billion total, but the operationally significant number is the letter-of-credit sublimit set at the same $1.07 billion. Before an AI data center campus can be built, a developer typically has to secure its place in a utility’s interconnection process, the queue and engineering studies that determine when and how a site connects to the grid, and reserve long-lead equipment. Hut 8’s release says both utilities and equipment vendors impose collateral requirements at this stage.
Posting that collateral in cash means money that could fund construction instead sits in escrow for months or years. A letter of credit gives the utility or vendor the same assurance, backed by a bank, while Hut 8 keeps its cash. Because the sublimit matches the full facility, the entire commitment can in principle be deployed as guarantees rather than loans, though in a typical revolver any letters of credit issued reduce what remains available to borrow. The release does not say how much has been issued so far.
For Hut 8, this is a capital-efficiency measure that directly targets the pre-construction phase. For the utilities and equipment makers on the other side of these obligations, it means their security comes from a syndicate of large banks rather than the balance sheet of a single developer.
Two Layers of Debt for Two Stages of a Campus
CFO Sean Glennan described the logic plainly: the revolver lets Hut 8 fund projects through development while it determines the optimal timing and structure for long-term, non-recourse financing as they de-risk. Non-recourse project debt is repaid from a specific project’s cash flows, and lenders generally cannot pursue the parent company if the project fails. That kind of financing is usually available only once a project has contracts, power and a construction path in place.
The revolver fills the gap before that point. Hut 8’s $7.5 billion of fully amortizing project financing for River Bend and Beacon Point, meaning debt that is paid down to zero over its life rather than refinanced, handles construction. The parent-level facility handles the earlier stage, when a site is still acquiring interconnection rights and equipment slots. Treating development as a recurring activity with a standing funding line, rather than financing each site from scratch, is the structural shift here.
That 12 lenders, led by four of the largest US banks, committed to a four-year corporate facility suggests they are comfortable underwriting Hut 8’s development activity on an ongoing basis. It is one facility at one company, however, and it does not by itself establish how lenders view former bitcoin miners as a group.
A Borrowing Cost Linked to the Share Price
The pricing grid ties Hut 8’s margin to its consolidated total debt-to-market-capitalization ratio. In practical terms, the company’s borrowing cost moves with both its debt load and its stock market value. If Hut 8 adds project debt or its shares fall, the ratio rises and the margin can step up toward SOFR plus 200 basis points; if its market value grows faster than its debt, the margin can move toward 150.
This is worth noting because the release frames the facility as non-dilutive, meaning it raises money without issuing new shares. That is accurate for the borrowing itself, but the cost of that borrowing remains exposed to equity markets. Hut 8’s own forward-looking statements list declining equity valuations and tightening lending standards among the financing risks it faces.
The secured structure is also a reminder of where the company stands today. Hut 8 describes an investment-grade corporate profile as something it continues to pursue. Investment-grade companies often borrow on an unsecured basis, so this facility reflects progress on access to capital rather than arrival at that goal.
Background
Hut 8 Corp., listed on Nasdaq and the Toronto Stock Exchange, describes itself as an energy infrastructure platform integrating power, digital infrastructure and compute for energy-intensive workloads such as AI, high-performance computing and ASIC compute, the specialized chips used in bitcoin mining. Like several companies that grew up in bitcoin mining, Hut 8 has leaned on its experience securing large amounts of power to move into AI data center development.
Its flagship AI projects are the River Bend and Beacon Point campuses, backed by $7.5 billion of fully amortizing, non-recourse, investment-grade project financing. The new revolver adds a corporate-level funding layer for the development work that precedes that project-level debt. Source: Hut 8 Expands Corporate Liquidity with $1.07 Billion Senior Secured Revolving Credit Facility, Hut 8’s September 28, 2026 announcement of a four-year revolver with a full-size letter-of-credit sublimit.Sources