Soluna Secures $5 Million in Non-Dilutive Debt Financing from Galaxy Digital

Rhea-AI Summary

Soluna Holdings (NASDAQ: SLNH) has secured a $5 million loan facility from Galaxy Digital (TSX: GLXY), marking a significant non-dilutive debt financing achievement. The loan features a five-year amortizing term and is secured at the project level with recourse to the parent company.

The financing demonstrates investor confidence in Soluna's business model of monetizing energy through AI and Bitcoin mining operations. Key features of the loan include the ability to prepay at any time and security to project-level assets. This strategic funding will support Soluna's continued project development and expansion in green data centers for intensive computing applications.

Positive

• Secured $5 million non-dilutive debt financing
• Five-year term loan with prepayment flexibility
• recourse to parent company, demonstrating strong project-level cash flows
• Financing structure preserves shareholder value by avoiding dilution

Negative

• Takes on additional debt obligations
• Assets pledged as collateral at project level

Insights

Financial Analyst

The $5 million non-dilutive debt financing secured by Soluna represents a significant financial achievement relative to the company's $10.8 million market capitalization. This financing constitutes nearly 46% of Soluna's public valuation while avoiding shareholder dilution—a important consideration for microcap companies where raising capital often comes at the expense of existing investors.

The loan's structure reveals several strategic advantages. First, the five-year amortizing term provides extended runway before major principal repayments come due. Second, the recourse nature suggests Galaxy Digital has confidence in the standalone economics of Soluna's projects rather than requiring full parent company guarantees. Third, the prepayment flexibility gives Soluna optionality to refinance should conditions improve.

Galaxy Digital's involvement adds institutional credibility. As a specialized digital asset financial firm, their willingness to provide project-level financing validates Soluna's business model of monetizing energy through computing applications. The absence of equity features in this deal indicates Galaxy sees sufficient value in the underlying assets and cash flow potential without requiring equity upside.

For a capital-intensive business like green data centers, securing non-dilutive financing at this scale strengthens Soluna's growth trajectory while maintaining its existing capital structure. This deal potentially creates a template for future project financing as the company expands its infrastructure for both AI and Bitcoin mining applications.

Technology Strategy Expert

Soluna's successful debt financing demonstrates the viability of its dual-purpose infrastructure strategy spanning both cryptocurrency mining and AI computing applications. This diversification approach is particularly valuable as it reduces dependency on any single computing market while maximizing the monetization potential of their energy resources.

The project-level financing structure validates Soluna's modular business model. By developing assets capable of securing their own financing with parent guarantees, the company establishes a scalable growth framework where each successful project potentially becomes self-financing. This approach is especially advantageous in rapidly evolving technical fields where infrastructure flexibility maintains competitive positioning.

Galaxy Digital's backing provides more than just capital—it represents technical validation from a specialized firm in digital assets. Their willingness to finance Soluna after presumed technical due diligence adds credibility to the company's approach to sustainable computing infrastructure development.

The $5 million capital infusion gives Soluna runway to scale operations at a critical time when both AI computing demand and Bitcoin mining face evolving economics. For a company with Soluna's market capitalization, this non-dilutive financing provides meaningful growth capital while preserving existing investor equity—a balance that's particularly difficult to achieve for smaller technology infrastructure companies.

ALBANY, N.Y.--(BUSINESS WIRE)-- Soluna Holdings, Inc. (“Soluna” or the “Company”), (NASDAQ: SLNH), a developer of green data centers for intensive computing applications, including Bitcoin mining and AI, announced today that it has successfully closed a $5 million loan facility with Galaxy Digital (“Galaxy”) (TSX: GLXY), a financial services and investment management innovator in the digital asset and blockchain technology sectors.

The loan will have a five-year term. It is secured, with limited recourse to the parent company—highlighting the strength of project-level standalone cash flows and the ability to attract institutional financing. The Company has the right to prepay the loan, in whole or in part, at any time, subject to certain requirements defined by the Loan Agreement.

“This deal underscores the strength of our project cash flows and demonstrates investor confidence in our ability to monetize energy through AI and Bitcoin mining,” said John Belizaire, CEO of Soluna Holdings, Inc. “Simply put, the assets we build are durable and very, very valuable. With this financing, we gain access to additional capital to accelerate our execution—without diluting our shareholders.”

“We’re excited to support Soluna with this financing,” said Max Bareiss, Head of Lending at Galaxy. “This deal reflects our confidence in Soluna’s business model and growth potential while underscoring our commitment to providing strategic capital to innovative companies at the forefront of technology.”

Nixon Peabody LLP acted as legal counsel to the Company. Orrick, Herrington & Sutcliffe LLP acted as legal counsel to Galaxy Digital.

Highlights of the Non-Dilutive Debt Financing:

• $5 million term loan

• Five-year amortizing term

• Non-dilutive debt financing with no equity features

• Security is limited to the assets at the project level, with a limited recourse parent company guarantee

• Supports Soluna’s continued project development and expansion

This financing marks another milestone in Soluna’s commitment to delivering sustainable, scalable computing solutions.

For more information about Soluna and its mission to make renewable energy a global superpower, visit www.solunacomputing.com.

Safe Harbor Statement

This announcement contains forward-looking statements. These statements are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as “will,” “expects,” “anticipates,” “future,” “intends,” “plans,” “believes,” “estimates,” “confident,” and similar statements. Soluna Holdings, Inc. may also make written or oral forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission, in its annual report to shareholders, in press releases and other written materials, and in oral statements made by its officers, directors, or employees to third parties. Statements that are not historical facts, including but not limited to statements about Soluna’s beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties, further information regarding which is included in the Company’s filings with the Securities and Exchange Commission. All information provided in this press release is as of the date of the press release, and Soluna Holdings, Inc. undertakes no duty to update such information, except as required under applicable law.

About Soluna Holdings, Inc (SLNH)

Soluna is on a mission to make renewable energy a global superpower using computing as a catalyst. The company designs, develops, and operates digital infrastructure that transforms surplus renewable energy into global computing resources. Soluna’s pioneering data centers are strategically co-located with wind, solar, or hydroelectric power plants to support high-performance computing applications including Bitcoin Mining, Generative AI, and other compute-intensive applications. Soluna’s proprietary software MaestroOS(™) helps energize a greener grid while delivering cost-effective and sustainable computing solutions, and superior returns. To learn more visit solunacomputing.com. Follow us on X (formerly Twitter) at @SolunaHoldings.

About Galaxy

Galaxy (TSX: GLXY) is a digital asset and blockchain leader providing access to the growing digital economy. We serve a diversified client base, including institutions, startups, and qualified individuals. Since 2018, Galaxy has been building a holistic financial platform spanning three complementary operating businesses: Global Markets, Asset Management, and Digital Infrastructure Solutions. Our offerings include, amongst others, trading, lending, strategic advisory services, institutional-quality investment solutions, proprietary bitcoin mining and hosting services, network validator services, and the development of enterprise custodial technology. The company is headquartered in New York City, with global offices across North America, Europe, and Asia. Additional information about Galaxy's businesses and products is available on www.galaxy.com.

View source version on businesswire.com: https://www.businesswire.com/news/home/20250318203334/en/

Cybele Ramirez

Director, Marketing

Soluna Holdings, Inc.

ir@soluna.io

Source: Soluna Holdings, Inc.

FAQ

What are the key terms of Soluna Holdings' (SLNH) $5 million loan from Galaxy Digital?

The loan has a five-year amortizing term, is secured at the project level, allows prepayment flexibility, and has recourse to the parent company.

How will the $5 million Galaxy Digital financing impact SLNH shareholders?

The financing is non-dilutive, meaning it won't reduce existing shareholders' ownership stakes, while providing capital for project development.

What is the purpose of SLNH's $5 million loan facility?

The loan will support Soluna's project development and expansion in green data centers for AI and Bitcoin mining operations.

What assets are used as collateral for SLNH's Galaxy Digital loan?

The loan is secured by project-level assets with recourse to the parent company Soluna Holdings.