Bankrupt cryptocurrency lender Celsius Network has permitted Bitcoin miner Core Scientific to close down over 37,000 mining rigs that were being handled for Celsius on account of the miner’s bankruptcy developments, as reported by Cointelegraph.
According to Cointelegraph, on January 3, 2023, Core Scientific made filing of a revised proposal that added “revisions acceptable to Celsius” stating “all Celsius rigs will be powered down effective January 3, 2023 and will not be restarted during the transition period.” It is believed that on October 19, 2022, Core Scientific blamed Celsius on account of its inability to pay power bills. Furthermore, the non-payment was considered as a component of the Bitcoin miner applying for Chapter 11 bankruptcy on December 21, 2022.
On the basis of information by Cointelegraph, on December 28, 2022, Core Scientific filed a motion to gain acceptance for refusing Celsius’ contracts, claiming the firm’s failure in paying power bills contributed towards breach of contract. Insights from court filings stated that the agreement’s termination would enable Core Scientific to generate revenue worth two million dollars per month from the sector currently occupied by Celsius’ mining rigs. Reportedly, Celsius was allowed to forward a certain amount of power costs to Celsius, which went up since Russia-Ukraine crisis.
Moreover, Cointelegraph noted that as per the denied motion, coverage of increased power fees cost Core Scientific around $7.8 million as of December 28, 2022, and the miner highlighted it “cannot afford to continue shouldering the burden of Celsius’ unpaid power costs.” Reportedly, Core Scientific witnessed a 99.15% fall in share price over the period of this year, while Iris Energy and Riot Blockchain saw falls of 91.79% and 85.09%, respectively.
(With insights from Cointelegraph)