Bit Digital pledged 74% of its staked Ethereum position to a loan that can trigger a 24-hour collateral call
Bit Digital pledged $105. 6 million of staked Ethereum to Galaxy, putting part of its AI funding strategy on a 24-hour collateral clock. Editor-in-ChiefCryptoSlateAug. 14, 2026at 12:30 am GMT2 min readBit. . .
Bit Digital pledged $105. 6 million of staked Ethereum to Galaxy, putting part of its AI funding strategy on a 24-hour collateral clock. Editor-in-ChiefCryptoSlateAug. 14, 2026at 12:30 am GMT2 min readBit Digital pledged 49,000 LsETH to back a $50 million Galaxy loan and booked a $46 million impairment. The financing funded WhiteFiber without selling ETH or issuing shares, but tied part of the treasury to loan collateral. Public filings do not show how close Bit Digital is to a margin call, while Galaxy can liquidate collateral if thresholds are missed. Bit Digital funded the majority-owned AI infrastructure company WhiteFiber without selling Ethereum or issuing new shares, but the route added a new dependency to its crypto treasury. Galaxy Digital lent Bit Digital $50 million in a borrowing associated with 49,000 pledged LsETH, and Bit Digital separately became a lender to WhiteFiber. The companysaid in its second-quarter resultsthat it converted73,235 ETHinto 66,192LsETH, the liquid-staking token it received in the exchange. It reported the pledged 49,000 LsETH as a $105. 6 million digital-asset collateral receivable and retained 17,192 LsETH, worth $27. 6 million, as a buffer against margin requirements. Bit Digitaldrew the $50 million from Galaxyon May 20 at a 5. 45% interest rate. The separate WhiteFiber delayed-draw facilitystarted at $100 millionand could rise to $150 million only by mutual written agreement. LsETH is associated with Bit Digital's company-levelGalaxyborrowing. WhiteFiber's facility is backed by a pledge of Enovum NC-1 Topco stock and a separate parent guaranty from White Fiber Operating Partnership. Galaxy'smaster loan agreementgivesBit Digital24 hours after an ordinary margin-call notice to add collateral. If a required call is not met, Galaxy can partially liquidate collateral to restore the contractual level. A faster nine-hour procedure may apply if an urgent threshold is specified. The public documents establish price-sensitive margin mechanics, but not Bit Digital's proximity to a call or liquidation. CryptoSlate Daily BriefDaily signals, zero noise. Market-moving headlines and context delivered every morning in one tight read. 5-minute digest100k+ readersFree. No spam. Unsubscribe any time. You’re subscribed. Welcome aboard. Infographic showing Bit Digital’s Galaxy and WhiteFiber funding arrangements, collateral terms, margin-call timing, and a $46 million non-cash LETH impairment. The impairment was an accounting hit, not a saleThe same quarterly release recorded a $46 million non-cash impairment on LsETH, and Bit Digital said it sold no ETH during the quarter. LsETH is carried at cost less impairment,unlike ETH's fair-value treatment, so the charge was not a realized loss. ETH staking revenue fell to $900,000 from $2. 3 million in the first quarter, while net loss attributable to Bit Digital shareholders reached $107. 2 million. The impairment was only one component of those results and does not indicate that the Galaxy loan breached a collateral threshold. The financing preserved the ETH position and avoided immediate dilution, but it also made part of the treasury's value relevant to WhiteFiber's funding chain. That trade-off is now part of a broader capital-allocation debate: CEO Sam Tabarsaid the board is evaluating share repurchases, subject to board and shareholder approval. 1H+0. 05%24H+0. 28%7D-0. 79%30D+0. 31%60D+9. 23%90D-15. 44%Ethereumis+0. 28%over the past 24 hours and currently sits at rank #2by market cap. Market cap$227. 52BVolume (24h)$6. 93B-10. 75%Circ. supply120. 68MFDV$227. 52BGlobal market cap$2. 18T24H market volume$47. 25BBitcoin dominance58. 48%Mentioned in this articlePosted inFollow the signalCurated intelligence, delivered your way. Never miss a market-moving update. Daily briefingTop stories & analysisMarket movesKey charts & dataPolicy updatesWhat to watchWeekly deep diveLong-form insights