PowerCompute, a Bitcoin treasury and mining company, has increased its debt by $3.765 million following an early reset of a Bitcoin collar covering 307 BTC. According to the executed schedule, the unwind cost was recorded as added principal rather than settled in cash or USDC.

A filing dated Aug. 28 disclosed a replacement 30-day collar balance of $21,892,131.88 with Arch Lending, up from $18,127,131.88. The facility continues to be secured by 307 BTC, but its annual interest rate has risen from 2% to 6.5%.

Structures of this kind have become a common way for Bitcoin-holding firms to raise working capital without selling coins: the lender extends credit against pledged BTC, while a collar sets a floor and ceiling that cap how much of the collateral's appreciation the borrower keeps in exchange for a lower rate. Arch Lending is one of several lenders that has marketed such Bitcoin-backed credit facilities to corporate treasurers.

How the collar reset raised the principal

PowerCompute's borrowing subsidiary, US Digital Mining and Hosting Co., elected to add the unwind cost to the outstanding balance. The annex states that this cost was agreed in place of any separate excess-appreciation settlement for the terminated period.

The previous collar began on Aug. 3 and was scheduled to reset on Sept. 2. PowerCompute terminated it on Aug. 25, 22 days into the period, at a reference price of $78,500. That figure sat above the structure's always-on ceiling of $66,370, as shown in the prior reset confirmation. The original loan filing carried the $18.13 million balance and the 2% rate. Terminating a collar early when the reference price sits above the ceiling means the borrower owes the excess-appreciation amount it had given up the right to keep, which is why the reset converted a modeled trade-off into $3.765 million of added principal.

Under the contract's 30/360 calculation, the replacement loan's full interest charge for the Aug. 25 to Sept. 24 period is $118,582.38. While the master agreement contains longer-form language, the annex governs the collar's 30-day mechanics and its reset schedule supplies the commercial figures.

Terms of the new collar

The new collar shifts the next decision point to Sept. 24. It establishes a $71,112 floor, a $75,000 ceiling and a $93,500 knock-in barrier. Arch will test the reference price only once, at 8:00 a.m. EST.

Below $93,500, the ceiling has no effect, and PowerCompute retains all Bitcoin appreciation even if the reference price exceeds $75,000. At or above $93,500, however, the ceiling applies to the entire period.

Excess appreciation arises only if the Sept. 24 reference price reaches at least $93,500. At the barrier exactly, the settlement formula is:

307 × ($93,500 − $75,000) = $5,679,500

This represents conditional settlement arithmetic before interest, not an amount already owed. PowerCompute can settle it using retained BTC or USD/USDC. If it rolls the loan, it may instead add the amount to principal or fold it into the next ceiling and rate quote.

The barrier is not an intraday liquidation line. The annex prohibits ordinary margin calls and liquidations during the rolling period, limits ordinary recourse to the pledged Bitcoin subject to stated carve-outs, and tests the collar only at reset. A voluntary mid-period exit would bring the test forward.

At 2:23 a.m. UTC on Aug. 29, CryptoSlate's live Bitcoin page showed a price of $77,808.23, placing the barrier roughly 20.2% above that snapshot. The comparison is provided as context, not as a forecast for the Sept. 24 price.

CryptoSlate previously covered the initial collar after tracking PowerCompute's earlier bridge-loan chain. The Aug. 28 filing converts the first structure's modeled trade-off into a realized financing cost and initiates a new 30-day test, with the Sept. 24 reset now the next disclosed milestone for the facility.