Bitcoin miner Core Scientific to file for Chapter 11 bankruptcy

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Core Sci­en­tif­ic Inc, one of the biggest pub­licly trad­ed cryp­to min­ing com­pa­nies in the Unit­ed States, will soon file for Chap­ter 11 bank­rupt­cy pro­tec­tion, CNBC report­ed, cit­ing one per­son famil­iar with the mat­ter. The com­pa­ny will file for bank­rupt­cy pro­tec­tion in Texas ear­ly on Wednes­day morn­ing but will not liq­ui­date, the report pub­lished late on Tues­day said, adding that it will con­tin­ue to oper­ate nor­mal­ly while reach­ing a deal with senior secu­ri­ty noteholders.

The devel­op­ment comes after one of the largest cred­i­tors of Core Sci­en­tif­ic B. Riley Finan­cial Inc had offered $72 mil­lion last week to avoid the bit­coin miner’s bank­rupt­cy. Core Sci­en­tif­ic did not imme­di­ate­ly respond to a Reuters’ request for com­ment out­side busi­ness hours. The Austin, Texas-based min­er, which oper­ates in Geor­gia, Ken­tucky, North Car­oli­na, and North Dako­ta, mines dig­i­tal assets, includ­ing coins like bit­coin and ethereum.

Bit­coin min­ers have been under severe pres­sure as their prof­itabil­i­ty dropped amid a slump in cryp­tocur­ren­cy prices and soar­ing ener­gy rates. The extreme mar­ket con­di­tions have also led to bank­rupt­cies of oth­er major cryp­tocur­ren­cy lenders such as Cel­sius Net­work and Voy­ager Dig­i­tal Ltd. Core Sci­en­tif­ic was also impact­ed by the lit­i­ga­tion with Cel­sius Net­works LLC and its affiliates. 

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