Thursday, March 30, 2023
HomeNewsCore Scientific's stock tanks 75% as troubled bitcoin miner floats bankruptcy

Core Scientific’s stock tanks 75% as troubled bitcoin miner floats bankruptcy

Shares of bitcoin miner and hosting provider Core Scientific fell 75% on Thursday after the company announced that it may run out of cash by the end of the year and may explore options such as bankruptcy.

The company’s shares traded at $0.25 at 1:30 p.m. ET, down from $1.01 at market close on Wednesday.

“The company may seek alternative sources of equity or debt financing, delay capital expenditures or evaluate potential asset sales, and potentially could seek relief under the applicable bankruptcy or insolvency laws,” the company said in a document filed Thursday with the U.S. Securities and Exchange Commission. “In the event of a bankruptcy proceeding or insolvency, or restructuring of our capital structure, holders of the company’s common stock could suffer a total loss of their investment.

The miner also announced that it would not be able to make payments due in late October and early November with respect to several of its equipment and other financings.

Core Scientific has been affected by a prolonged decline in the price of bitcoin, a rise in electricity costs and the increase in the global bitcoin network hash rate, the company said. On top of that, it has been in a legal battle with bankrupt Celsius Mining over what it claims are “outstanding amounts owed.”

The industry in general has faced those same struggles recently, with bitcoin mining hosting company Compute North filing for bankruptcy last month.

“Among possible alternatives, the company may explore liability management transactions, including exchanging its existing debt for equity or additional debt, which transactions may be dilutive to holders of the company’s common stock,” the company said.

Article Source



NamePrice24H (%)
Bitcoin (BTC)
Ethereum (ETH)
Solana (SOL)

Most Popular

Recent Comments