> ## Documentation Index
> Fetch the complete documentation index at: https://docs.mezzamine.com/llms.txt
> Use this file to discover all available pages before exploring further.

# How It Works

> The refinance process, what changes versus a BTC-only loan, and how freed Bitcoin offsets interest.

Refinancing adds collateral a BTC-backed lender never counted: your ASICs. With the hardware underwritten into the package, Mezzamine holds a much smaller BTC pledge and releases the rest.

<Steps>
  <Step title="Bring your loan and your ASICs">
    Send your existing BTC-backed facility terms and your fleet details.
  </Step>

  <Step title="Mezzamine underwrites the fleet">
    The fleet is verified at the source, from pool data to power contracts to financials, and stress-tested across thousands of BTC price paths.
  </Step>

  <Step title="Your ASICs join the collateral package">
    The new facility is secured by your ASICs plus a residual BTC pledge set per facility, under a first-lien claim. It is BTC-denominated and carries program-level hedging.
  </Step>

  <Step title="Your Bitcoin is released">
    The old facility is retired and the Bitcoin no longer needed as collateral is returned to you.
  </Step>
</Steps>

## What changes

|                          | BTC-backed loan           | Mezzamine refinance                       |
| ------------------------ | ------------------------- | ----------------------------------------- |
| BTC locked as collateral | 150% of principal or more | A small residual pledge, set per facility |
| What secures the debt    | Your Bitcoin only         | Your ASICs and a small BTC pledge         |
| Repaid in                | USD                       | BTC, the asset you mine                   |
| Margin calls             | In bear markets           | None                                      |
| Yield on collateral      | 0%                        | Up to 9% on the Bitcoin released          |

A USD-denominated loan forces you to convert more Bitcoin into dollars as BTC falls, and demands more collateral in a bear market when the balance sheet is weakest. The refinance is repaid in BTC and carries program-level hedging, so a BTC decline does not trigger a margin call. See [Fleet Hedging](/for-miners/asic-financing/fleet-hedging).

## Interest offset

The Bitcoin released by the refinance can be put to work, and the yield it earns can offset the interest on the facility.

<Steps>
  <Step title="Deploy the released Bitcoin">
    Freed Bitcoin is deployed into BTC yield strategies at up to 9% APY, paid to you.
  </Step>

  <Step title="Yield offsets interest">
    The facility charges interest in BTC and the released Bitcoin earns yield in BTC. When enough is deployed at a yield that matches the facility rate, the two cancel and your net cost of borrowing approaches zero.
  </Step>
</Steps>

<Warning>
  Net zero APR is a target, not a guarantee. Reaching it depends on the performance of BTC yield strategies and on deploying enough of the released Bitcoin to cover the interest owed. Figures are illustrative and deal-specific.
</Warning>

To see what a refinance would release on your facility, see [Getting Started](/for-miners/btc-loan-refi/getting-started).