top of page

Core Scientific Goes Bankrupt

GB Market Commentary 21/12/2022

by Marcus Sotiriou


Core Scientific is an American-based, publicly listed Bitcoin miner, and is one the largest bitcoin miners in the world, until today. Core Scientific has just filed for bankruptcy after a prolonged period of unsustainable conditions for the company.


According to the bankruptcy filing, Core Scientific’s liabilities are between $1 billion and $10 billion, and has 1,000-5,000 creditors, and its estimated assets are also between $1 billion and $10 billion.


This is the biggest bankruptcy to occur yet in the Bitcoin mining sector, as Core Scientific operates 143,000 mining runs (whilst hosting another 100,000) and accounts for about 10% of computing power on the Bitcoin network.


In October, Core Scientific said that it would not be paying some of its loan payments, and then warned in November that it could run out of money by the end of the year. Investment bank B.Riley proposed to provide $72 million to help finance the company, but attempts like this to restructure debt and raise capital since then have failed.


Core Scientific is one of several miners struggling to keep afloat as rising energy prices increase costs, while stubbornly low bitcoin prices slash revenues. Compute North, another major firm in the space, filed for Chapter 11 bankruptcy in late September. The bankruptcy of Core Scientific

Core Scientific claims Celsius owes them $5.2 million, hence being impacted by the bankruptcy of Celsius’s mining arm, in addition to BlockFi, which reportedly owes Core Scientific $54 million. This demonstrates the contagion effect of lenders like BlockFi and Celsius becoming bankrupt, however this brings us one step closer to weeding out the remaining zombie companies that are left, to provide a solid foundation for sustainable growth.


Комментарии


bottom of page