Bankrupt crypto lender Celsius Network has agreed to give up Bitcoin (Bitcoin) Miner Core Scientific closed over 37,000 mining rigs it hosted for Celsius during the miner’s bankruptcy proceedings.
core scientific submitted The revised order, proposed on January 3, incorporates “Celsius-acceptable amendments” and states that “all Celsius rigs will be shut down from January 3, 2023 and will not be restarted during the transition period. ” is stated.
On October 19, Core Scientific denounced Celsius: fail to pay the electricity billcited nonpayment as a major factor in the liquidity problems that later led to Bitcoin miners Chapter 11 bankruptcy filing December 21st.
On December 28, Core Scientific announced rejection Celsius’ contract claimed that the company’s failure to pay the electricity bill was a material breach of contract.
The termination of the contract will allow Core Scientific to generate $2 million in monthly revenue from the space currently occupied by Celsius’ mining rig, according to court filings.
The terms of the hosting agreement allowed Core Scientific to pass on some of its power costs to Celsius, but those costs have increased significantly since Russia’s invasion of Ukraine.
According to the motion to dismiss, as of Dec. 28, it would have cost Core Scientific about $7.8 million to cover the increased power rates, and miners would “continue to bear the unpaid power costs of Celsius. I can’t afford it,” he said.
While the price of Bitcoin has fallen, miner production costs have risen. eat into miner profits It also contributed to the “hash price” (the revenue Bitcoin miners earn per hash rate), which has declined by more than 75% in 2022.
The lack of miner profitability combined with the costs associated with expansion efforts meant that many Bitcoin miners struggled towards the end of 2022, resulting in a sharp decline in their stock prices.
Core Scientific’s share price is down 99.15% over the year, while Iris Energy and Riot Blockchain are down 91.79% and 85.09% respectively.