One of the largest bitcoin miners – Core Scientific – could run out of cash by the end of 2022, which could prompt it to file for bankruptcy.
The firm’s shares took a major punch following the news. Current market data shows they trade at around $0.28, an approximately 72% decline compared to yesterday’s figures.
- The market decline, the rise in energy costs, and increased competition are the main factors that have negatively impacted the entity’s performance and liquidity.
- Core Scientific stated it will postpone its payments in October and early November “with respect to several of its equipment and other financings, including its two bridge promissory notes.”
- The company has been actively exploring alternatives and hired several professionals to help with its issues. However, there is a real chance it could run out of funds by the year’s end and seek bankruptcy protection:
“Substantial doubt exists about the company’s ability to continue as a going concern for a reasonable period of time.”
- Currently, the miner holds 24 BTC and has around $26.6 million in cash. In comparison, it owned 1,051 BTC and $29.5 million last month.
- Core Scientific entered NASDAQ through an estimated $4.3 billion merger with Power & Digital Infrastructure Acquisition Corporation earlier this year.
- At the moment of writing these lines, the shares hover about $0.28, a considerable 72% plunge compared to the prices 24 hours ago.
- Another crypto miner that struggles with the same problems is the Texas-based Compute North. It filed for Chapter 11 bankruptcy last month after revealing it owes approximately $500 million to at least 200 creditors.