What happened

Shares of CleanSpark (CLSK -1.90%), which concentrates most of its efforts on mining Bitcoin (BTC 0.77%), saw an even more precipitous decline than the falling token on Tuesday. CleanSpark's shares plummeted by just under 11% during the day, as investors showed their displeasure at the company's latest financing news.

So what

Tuesday morning, CleanSpark announced that it has secured a $35 million equipment-financing loan from venture-debt financier Trinity Capital. This facility's term is three years and has a relatively hefty annual interest rate of 9.9%.

Person inspecting a bank of crypto mining machines.

Image source: Getty Images.

Not surprisingly, CleanSpark intends to use these monies "for growth capital expenditures" -- in other words, the means by which it can mine more Bitcoin. The company said it currently operates a "fleet" of more than 23,000 mining machines and has another 12,000 or so on order. These should be delivered and deployed through October of this year.

CleanSpark took pains to point out that by entering into the new loan facility, it isn't resorting to a dilutive secondary stock offering. 

The company quoted its CFO Gary Vecchiarelli as saying that "debt capital is currently the lowest cost of capital available to the Company." He added that CleanSpark intends to continue securing "non-dilutive capital" to fund its operations.

Now what

Investors clearly weren't being wowed by the "it's not dilutive!" spin CleanSpark is putting on the Trinity Capital debt facility. In an age of still-low interest rates, shareholders don't like seeing high numbers like the 9.9% the company will be paying for its latest financing instrument.