US bitcoin miner Core Scientific files for bankruptcy

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One of the largest U.S.-listed bitcoin miners has filed for bankruptcy as companies grapple with falling token prices and rising costs for the energy-intensive cryptocurrency production business.

On Wednesday, Core Scientific filed for Chapter 11 bankruptcy protection in Texas, where it is based.

The company said it plans to continue mining and producing bitcoin while it reaches a restructuring agreement with its lenders and creditors.

The Nasdaq-listed crypto miner is part of the Russell 2000 Index, a widely held benchmark for small US companies, which means its bankruptcy will hit the wallets of many investors and add to the woes of the crypto industry. Its market value hit nearly $3 billion in April, but has since fallen to less than $100 million, according to FactSet data.

The company operated facilities in five US states where computers ran through complex equations in a race against other participants in the bitcoin network to create new units of the cryptocurrency.

It is one of many listed crypto miners whose shares have been hit as their profits are caught between falling crypto token prices and rising global prices for the large amounts of energy burned in the process. extraction.

Core Scientifics’ stock is down 98% this year.

The filing of these files was necessitated by a decline in operational performance and liquidity of the company suffering from the prolonged decline in the price of bitcoin [and] rising electricity costs needed to power the company’s data centers, Core Scientific said in a statement.

The price of bitcoin, the largest cryptocurrency, has fallen more than 65% this year against the dollar, hitting two-year lows.

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