Hyperscale Data sold 686 Bitcoin in August to clear its Morpho loans, leaving a $100 million-plus Michigan build and going-concern warning unresolved.
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Hyperscale sells 686 BTC to repay loans, flags 12-month cash gap
Hyperscale Data sold 686 Bitcoin in August to clear its Morpho loans, leaving a $100 million-plus Michigan build and going-concern warning unresolved.
Hyperscale Data sold 686 Bitcoin for $43.4 million in August, using part of the proceeds to repay all its Morpho loans, its quarterly filing shows.
The repayment released pledged cbBTC collateral and left no outstanding borrowings on the decentralized lending protocol, according to the Form 10-Q filed with the SEC. As of June 30, Hyperscale had about $16 million of Morpho borrowings secured by cbBTC with a carrying value of about $25.4 million. After the quarter ended, it received another $31.6 million in net proceeds from additional Bitcoin-backed borrowing through Morpho before eliminating the DeFi debt in August.
The repayment removed a near-term collateral obligation, but Hyperscale said its available liquidity is not expected to cover operating requirements, obligations and planned capital expenditures for the next 12 months, raising substantial doubt about its ability to continue as a going concern.
The company reported $36.8 million in cash and cash equivalents against $201.7 million in current liabilities as of June 30, including about $99.3 million of notes and convertible debt due within a year. It recorded a $49.1 million consolidated net loss for the first half and used $9.9 million of cash in operating activities.
DeFi debt cleared, funding gap remains
The completed repayment is the key change from Aug. 6, when an earlier 150.5-Bitcoin sale happened. Hyperscale received the additional borrowing after June 30 before eliminating the DeFi debt altogether in August.
Crypto-related risks intensified during the quarter. Hyperscale recorded a $7.1 million impairment on cbBTC collateral and a $2.3 million impairment on mining equipment as it reallocates capacity at the Michigan data center from Bitcoin mining toward AI compute services. Total crypto holdings, including restricted, were $46.1 million at June 30.
Management expects the roughly 20-megawatt deployment at its Michigan AI data center to require more than $100 million of investment over time, with timing and amount depending partly on financing availability. The Morpho repayment resolved one source of financing pressure without addressing how the build will be funded.
What's at stake
The forced sale and going-concern warning from a Bitcoin treasury company could weigh on the treasury model, which drew scrutiny after two collateral calls hit the sector earlier in 2026. Bitcoin traded at $69,668.68, up 8.20 percent over 24 hours, as of the latest data.
Hyperscale must still raise or generate enough capital to meet its obligations and complete the Michigan deployment while operating under a going-concern warning. The company has an at-the-market offering program under which it may sell Class A shares, and management said it is evaluating additional financing alternatives.
This article is for informational purposes only and does not constitute investment advice.
[1] Bitcoin treasury Hyperscale sells 686 BTC to clear loans but says cash won't cover next 12 months[2] Bitcoin treasury Hyperscale sells 686 BTC to clear loans but says cash won’t cover next 12 months[3] Hyperscale Data $78.9M H1 sales, going concern doubt | GPUS Quarterly Report (10-Q)[4] Down 50% on crypto and burning $8 million in cash, this Nasdaq firm just pivoted to event robots to survive[5] Hyperscale Data notes material corporate event | GPUS 8-K Filing
