[ad_1]
Core Scientific, one of the biggest bitcoin mining companies, has become the latest company to file for bankruptcy amid a difficult year for the cryptocurrency industry.
Core Scientific mines Proof-of-Work cryptocurrencies like bitcoin. The process involves powering data centers spread across the United States filled with highly specialized computers that process mathematical equations to validate transactions and simultaneously create new tokens.
The process requires expensive equipment, some technical know-how and a lot of electricity.
The company’s action to file for bankruptcy is likely related to the cryptocurrency price crash that took place in 2022, as well as a drop in energy prices. Additionally, the company’s capitalization had fallen to $78 million the day before the filing, from a valuation of $4.3 billion in July 2021.
At the time, the company went public through a special purpose acquisition vehicle, or SPAC, but its stock has now fallen more than 98% in the past year.
In another example of the contagion that swept through several businesses mid-year, crypto lender Celsius, which filed for bankruptcy protection in July 2022, was a Core customer. So when Celsius’s debts were wiped out during its bankruptcy proceedings, it put a strain on Cores’ balance sheet.
Core is not the only crypto mining company affected in this way. In September 2022, Compute North, which provides hosting services and infrastructure for crypto mining, also filed for Chapter 11 bankruptcy.
At the time, another mining company, Marathon Digital Holdings, reported an $80 million exposure to Compute North.
If that wasn’t enough, Greenidge Generation, a vertically integrated crypto miner, reported net losses of over $100 million in the second quarter in August 2022 and suspended its expansion plans.
Finally, Argo shares plunged 60% after it announced in October 2022 that its plan to raise $27 million from a “strategic investor” was no longer in the works.
See also
__________________________________
Follow us on Twitter for the latest articles and updates
Join and interact with our Telegram community
__________________________________
__________________________________
|
Sources 2/ https://news.google.com/__i/rss/rd/articles/CBMiQmh0dHBzOi8vYml0Y29pbmtlLmlvLzIwMjMvMDEvY29yZS1zY2llbnRpZmljLWZpbGVzLWZvci1iYW5rcnVwdGN5L9IBAA?oc=5 The mention sources can contact us to remove/changing this article |
[ad_2]