Maestro launches mining-backed Bitcoin credit market for institutions

Bitcoin infrastructure provider Maestro has launched a Bitcoin-denominated credit market backed by mining economics, aiming to give institutions a new way to earn yield on idle Bitcoin while expanding financing options for miners.

Maestro said Mezzamine went live with its first program in partnership with mining-as-a-service provider Sazmining. According to a Tuesday announcement shared with Cointelegraph, the program is designed to let institutional Bitcoin ($BTC) holders deploy $BTC into mining-backed credit facilities targeting an annual yield of 8% to 9%.

The offering is designed to connect miners seeking capital with institutional Bitcoin holders seeking $BTC-denominated yield, creating an onchain credit market tied to mining expansion rather than protocol staking rewards.

“New Bitcoins are mined every 10 minutes, and with Mezzamine $BTC holders can earn and share block rewards with miners,” Marvin Bertin, Maestro’s co-founder and CEO, said in the announcement.

Related: Top Bitcoin mining stocks rise as US winter storms cut hashrate

Bitcoin-native credit market seeks to fix miner financing gap

Bitcoin mining firms often face limited financing options, typically relying on dollar-denominated debt against Bitcoin collateral or, if publicly listed, equity issuance.

Because many miners’ liabilities are denominated in dollars while revenue is earned in Bitcoin, that structure can leave operations more exposed during sharp market downturns.

Maestro said the credit facility includes bear-market protection features, including hedging tied to Bitcoin prices and mining-fleet economics, to help stabilize performance during downturns.

The company said miners may face higher financing costs in stronger markets in exchange for a structure designed to offer greater stability during downturns.

Launch of the first Bitcoin-native credit market for mining economy. Source: Maestro

The offering is aimed at institutional investors, corporate treasuries, asset managers, family offices and registered investment advisers. Suresh Rajan, Mezzamine’s managing director, told Cointelegraph the minimum allocation is $100,000 worth of Bitcoin.

Mezzamine said the yield is derived directly from mining production. Miners borrowing through the platform use capital to buy additional ASIC hardware and expand hashrate, with part of the resulting block rewards used to service the credit facility and the remainder flowing to the miner.

According to Maestro, institutions receive yield funded entirely by the mining output, without additional token incentives or leveraged strategies.

Related: Solo Bitcoin miner bags over $200K block reward using rented hashrate

Bitcoin-denominated loans reduce miner liquidation risks

Bitcoin miners seeking traditional financing are often required to overcollateralize two-fold, increasing liquidation risks during Bitcoin price drops.

The new credit facility reduces that risk by denominating loans in Bitcoin and removing dollar-denominated call risks, Mezzamine’s managing director, Rajan, told Cointelegraph:

“A decline in Bitcoin’s price against the dollar does not trigger a margin call, and with Mezzamine’s hedged vehicle, the hedge actually returns profits in bear markets that can supplement mining revenue and further capitalize the program.”

“The loan performs according to mining economics, not currency markets,” he added.

Maestro told Cointelegraph it has seen more than 1,500 $BTC in borrowing demand from qualified mining operators exploring alternative financing channels, including public miners and mid-sized operators.

Sazmining describes itself as a Bitcoin mining-as-a-service provider whose operations rely on hydropower and other carbon-free energy sources.

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