TeraWulf's $3.20 billion bond issue makes it the first crypto miner to raise money in high-yield markets

According to Bloomberg, TeraWulf became the first cryptocurrency miner to raise money in the high-yield market with a $3.20 billion junk bond issue, making it the largest junk bond issue led by Morgan Stanley since the famous leveraged buyout RJR Nabisco in 1989. The deal attracted orders of more than $11 billion, thanks to a "back-up" guarantee from Alphabet Inc.'s Google. The guarantee will take effect after the data center is operated and leased by UK startup Fluidstack. To assuage concerns about unfinished infrastructure, TeraWulf's top executives hosted nearly 40 potential investors for more than three hours of question-and-answer sessions at a venue near Buffalo, N.Y., about a week before the deal was launched, according to people familiar with the matter. In addition, creditors will receive a yield of 7.75%, well above the average rate of return of 5.7% on equally rated bonds, which also helps the deal's outcome.
Cryptocurrency miner Cipher Mining Inc. is next in line to issue billions of dollars in bonds that will also be backed by Google, according to people familiar with the matter. Morgan Stanley is taking a hefty fee for the deal. The investment bank advised on TeraWulf's convertible bond deal in August and is working with Cipher to issue similar bonds.