Bitcoin mining firm sells Texas data center to bankrupt competitor for $14 million By Investing.com

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Bitcoin mining firm sells Texas data center to bankrupt competitor for $14 million

Published Sep 16, 2023 07:50

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Bitcoin mining firm sells Texas data center to bankrupt competitor for $14 million

In a recent development, Bitcoin mining firm Core Scientific Inc. has agreed to sell its Texas-based data center to Celsius Network LLC's mining unit, a company that filed for bankruptcy last year. The sale, which is valued at $14 million and is pending court approval, marks the end of ongoing litigation between the two companies.

The dispute between Core Scientific and Celsius Mining stemmed from disagreements over their hosting contracts, particularly regarding who should bear the electricity costs. Celsius had engaged Core Scientific to manage and house its numerous Bitcoin mining machines, but disagreements led to legal battles.

Both companies had filed for bankruptcy last year in the wake of a series of cryptocurrency market crashes. Core Scientific cited Celsius' failure to meet financial obligations as a contributing factor to its own liquidity issues.

The Texas data center that Celsius will acquire is partially developed and non-operational at present. It boasts an available power production capacity of 215 megawatts and includes buildings that are under construction, as well as equipment and designs necessary for the completion of the facility. Once operational, it has the potential to be one of the largest mining facilities in Texas.

Despite its bankruptcy status, Celsius Mining continues its operations and plans to increase its mining capacity to 300 megawatts with this new site. The company has engaged US Bitcoin Corp., the winning bidder in a bankruptcy auction for managing Celsius's mining assets, to oversee the construction of the facility.

On the other hand, Core Scientific is planning to get re-listed on an exchange later this year. The company clarified that this site sale would not impact its mining fleet nor interfere with its three-year roadmap outlined in June 2023.

Celsius Mining had a bold entry into the industry, with an initial public offering (IPO) for the unit launched in 2022. However, it declared bankruptcy just a few months later. A significant portion of its mining fleet was managed by hosting service providers, including Core Scientific.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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