Bitcoin Miner Core Scientific Says It May Seek Bankruptcy (bloomberg.com) 73
Core Scientific, one of the world's largest miners of Bitcoin, warned that it may run out of cash by the end of the year and could seek relief through bankruptcy protection. Bloomberg reports: Operating performance and liquidity have been severely impacted by the prolonged drop in the price of Bitcoin, a rise in electricity costs, increased competition and litigation with bankrupt Celsius Networks LLC, the Austin, Texas-based company said in a US Securities and Exchange Commission filing on Thursday. Shares of Core Scientific dropped 78% on Thursday, its worst trading day since going public earlier this year through a merger. Bitcoin mining companies such as Core Scientific had recently been increasingly opting to sell equity, resorting to one of their least attractive options to raise money as profits dry up and higher interest rates makes borrowing more expensive. The company entered into a $100 million common stock purchase agreement with B. Riley Principal Capital II in July. Bitcoin has slumped almost 70% since reaching a record high in November 2021.
"We could see similar filings within the sector," said Brian Dobson, an analyst at Chardan Capital, who had a 'buy' rating on the shares. "This is going to weigh on all of the publicly traded crypto miners." Should Core Scientific file for bankruptcy, it would likely be the first large publicly traded Bitcoin miner to do so, Dobson said. Core Scientific said it won't make payments coming due in late October and early November with respect to several of equipment and other financings, including two bridge promissory notes. The company is exploring alternatives, including hiring strategic advisers, raising additional capital or restructuring its existing capital structure. Core Scientific held 24 Bitcoins and approximately $26.6 million in cash as of Thursday. That's compared with 1,051 Bitcoins and about $29.5 million in cash as of September, the company said in the filing. The shares, which traded as much as $14.32 late last year, closed at 22 cents. they've tumbled 98% since the start of the year.
"We could see similar filings within the sector," said Brian Dobson, an analyst at Chardan Capital, who had a 'buy' rating on the shares. "This is going to weigh on all of the publicly traded crypto miners." Should Core Scientific file for bankruptcy, it would likely be the first large publicly traded Bitcoin miner to do so, Dobson said. Core Scientific said it won't make payments coming due in late October and early November with respect to several of equipment and other financings, including two bridge promissory notes. The company is exploring alternatives, including hiring strategic advisers, raising additional capital or restructuring its existing capital structure. Core Scientific held 24 Bitcoins and approximately $26.6 million in cash as of Thursday. That's compared with 1,051 Bitcoins and about $29.5 million in cash as of September, the company said in the filing. The shares, which traded as much as $14.32 late last year, closed at 22 cents. they've tumbled 98% since the start of the year.
Re: Miners are irrelevant (Score:5, Insightful)
Yes, and anyone with a crappy computer will be able to double spend coins, since the combined mining power will be less than what I have in my desktop GPU.
Please learn how Bitcoin works before making dumb claims.
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Please learn how Bitcoin works before making dumb claims.
They, or at least the person that told them the lies they spout, probably know fine. It's just part of the general Bitcoin con. Bitcoin people are now going around telling everyone how Bitcoin is superior to other crypto systems that use systems like proof of stake because control of mining is "distributed" and not like those other coins which don't burn energy as directly for security. Given that the only way to be space/energy == money efficient in bitcoin is very much dedicated hardware and that means th
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It's true... every crypto miner that goes out of business causes mining difficulty to lower and makes it easier for everyone else to make a profit. Everyone should be rooting for these companies to fail, especially other miners.
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It would be nice if mining de-consolidated. Don't expect that to happen, though.
Consolidated mining break bitcoin security model (Score:2)
It would be nice if mining de-consolidated. Don't expect that to happen, though.
It would be especially nice since the bitcoin security model assumes that is the case.
Of course with mining once again being done at the PC level, pools are a consolidation problem as well.
Re:Imaginary value... (Score:4, Informative)
every digitit asset business shouldn't be able to file for bankruptcy.
Do you understand what bankruptcy is or how it works?
What do you suggest as an alternative? Debtors' prison?
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Harvesting and selling organs. The only value some people have.
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How about selling them into slavery?
Re:Imaginary value... (Score:4, Funny)
Not really an option anymore. You have to feed and shelter slaves, you have to carry the risk of them getting sick or dying, and you're competing with the option to just rent people while offloading that risk onto them.
Nope, organ trafficking it is.
Re:Imaginary value... (Score:4, Funny)
Not really an option anymore. You have to feed and shelter slaves, you have to carry the risk of them getting sick or dying, and you're competing with the option to just rent people while offloading that risk onto them.
Nope, organ trafficking it is.
Can't we sell them for Medical Experiments? I know of a family with too many kids who did that. It really helped the neighborhood out because they kept going around singing some song about something being sacred.
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Looks like you're volunteering.
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Sure, come over, I'll make you valuable.
Or at least parts of you.
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Mario will be by to take your liver in three days.
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He better bring Luigi along.
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Luigi will give the liver back. He's not a team player.
https://www.youtube.com/watch?... [youtube.com]
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What do you suggest as an alternative? Debtors' prison?
Yes, or just regular prisons.
Re: Imaginary value... (Score:2)
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Marijuana is a controlled substance. Bitcoin isn't.
Re: Imaginary value... (Score:2)
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What do you suggest as an alternative? Debtors' prison?
I wish...
These are people who spent a lot of money they don't have in the hopes of ripping off the general public.
I don't believe for one second they didn't squirrel away anything for themselves.
Debtors prison seems very fair to me.
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They are in debt of real money which they used to buy GPU and electricity.
Re: Imaginary value... (Score:1)
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So is everyone in the marijuana industry, but it's not federally legal, so no bankruptcy for them.
Yeah, but if they lose their investment and go broke they can smoke their excess inventory to avoid the depression.
Scap metal value of its heat sink (Score:2)
They are in debt of real money which they used to buy GPU and electricity.
As bitcoin miners they were not buying GPUs. They were buying specialized ASIC hardware, hardware that can do nothing other than mine bitcoins. The salvage value of an ASIC is pretty much the scrap metal value of its heat sink. GPUs have some salvage value and can be sold as "used".
The recent GPU mining craze was driven by ethereum, which has just abandoned mining with its move from proof-of-work to proof-of-stake. A different way to distribute management of the blockchain. There are other alt coins that
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As bitcoin miners they were not buying GPUs.
They aren't bitcoin miners, they are a crypto miners who among many coins mine bitcoin and who have NVIDIA as one of their partners. Ethereum (which they are heavily involved in) miners are huge GPU buyers.
Offer CUDA based processing with those GPUs (Score:2)
As bitcoin miners they were not buying GPUs.
They aren't bitcoin miners, they are a crypto miners who among many coins mine bitcoin and who have NVIDIA as one of their partners. Ethereum (which they are heavily involved in) miners are huge GPU buyers.
Were huge GPU miners. The recent switch by ethereum to proof-of-stake ended that. The remaining alt coins are not profitable to mine, even on high end Nvidia cards. However, those Nvidia card have a salvage value on the used GPU market.
Or alternatively the GPUs could be repurposed to offer computational services for those wanting to run cuda based software. ML, AI, etc.
Government (Score:5, Insightful)
...seek relief through GOVERNMENT bankruptcy protection? Seriously?
Re:Government (Score:5, Informative)
Yeah, stick it to da man!
As long as I make profit, it's mine, but when I fuck up, I suddenly realize that there is a society that I wanted to shit on that I now need to save my sorry hide.
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How can they have spent all those billions anyway?
They were making billions, right? That's what I was told...
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Same way I'm a billionaire by having 2 eggs each worth 500 millions.
Re: Government (Score:2)
I honestly doubt that you paid 500 million for those eggs, therefore their worth must be skyrocketing! How much are you selling shares for? I would like to get in before everyone else.
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They sure did pay $500 million for those eggs. Granted, they were buying them from themselves. If I buy an egg for $1, I can sell it to myself for $1 billion and be an instant billionaire!
Then I just need to find someone to buy my billion dollar egg at only a tiny markup (say $1.01 billion). That should be easy because the value is skyrocketing and anyone who buys my egg will be able to resell it for far more than they paid! ...and that's the whole concept that's been driving cryptocurrency and NFTs, exc
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Nah, I paid like 30 cents, but that was a decade ago, by now they're worth millions. Millions, I tell you!
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According to tradition aren't you supposed to wait 1,000 years for them to be that valuable?
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Well, they are the "guys with lambos" that people kept posting about when trying to convince you to be a lemming and pour your money into the furnace right next to theirs. So, presumably, the "billions" went to Lamborghini and their licensed dealers.
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Crony-capitalism in a nutshell.
Re:Government (Score:4, Funny)
Until decentralized bankruptcy protection starts working, government one will have to do.
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Thanks. I didn't want to drink that coffee anyway. *wipe wipe wipe*
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Popular in gov to pay for bad decisions (Score:2)
...seek relief through GOVERNMENT bankruptcy protection? Seriously?
Why not? It fashionable right now to have government pick up the bill for your personal poor choices.
Spending $150-200K to get a "[insert oppressed group here] Studies" major at an expensive private college, buying ASIC hardware to mine bitcoins, if one group of idiots can be bailed out by the tax payer why not the other?
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I wont cheer (Score:4, Insightful)
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Every day with a bankruptcy of a miner is good day for our climate.
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“It's always darkest before the dawn” (Score:1)
“It's always darkest before the dawn” ?
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Sometimes, though, the light at the end of the tunnel is just an oncoming train.
Re:“It's always darkest before the dawn& (Score:2)
You can always hodl on to your darkness to banish the light, and those trains are all government regulated interference, so pretending those don't exist will make them not exist.
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Very apt analogy, let's pretend the trains ain't there, then demand to be taken along to the hospital after it rolled over you.
Good riddance! (Score:5, Insightful)
These wasteful pointless setups should be gone ASAP!
Future generations will look back and unable to understand why these pointless waste of electricity were allowed to continue for so long.
Re:Good riddance! (Score:4, Insightful)
It's a shame that Bitcoin wasn't designed to use a proof of work that contributed something to humanity, like Folding@Home.
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CureCoin and GridCoin were just that. Neither one caught on, which is a shame.
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Oh my poor tiny violin (Score:2)
Can they just make do with a "Hahahahahahaha, fuck you and your disgusting waste of the world's resources" ?
Boo hoo (Score:2)
Bankruptcy? (Score:1)
I thought bankruptcy protection could only be sought by (and granted to) viable businesses which had difficulties due to transient circumstances or suboptimal management. In this case, the core business of the company is worthless and they have no real way to create value. Perhaps they should end with a Chapter 7 liquidation, not bankruptcy which can only prolong the agony.
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Low BTC prices would be transient circumstances.
As long as someone else is willing to pay for the product (and they are!), it would be impossible for anyone to show that the "have no real way to create value".
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Do you mean chapter 7 of the US bankruptcy code?
So they owed too many actual dollars (Score:3)
It's ironic that when all is said and done, the dollar is still what people actually need.
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Seriously, I don't get everyone's argument. The end item that everyone is after is actually fiat currency, not the "crypto coin". The only places that use the crypto anymore are for payments for various nefarious reasons in most cases. Very few legit places use it due to the high volatility (and them realizing it is all a house of cards).
May they rot in hell (Score:1)
Sorry, we Defi'd Bankrupcy (Score:3)
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Failed to Provide Subversive Money, Now Need Help (Score:3)
Go broke printing money (Score:2)
The Spanish Empire extracted so much silver from the New World that it went bankrupt. Now bitcoiners follow suit.
Fiat currency doesn't look so bad now, does it?
Butthurt mods.... (Score:2)