Home » Core Scientific shares fall 76% after the bitcoin miner warns it can’t pay debt

Core Scientific shares fall 76% after the bitcoin miner warns it can’t pay debt

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Core Scientific (colts), it will not make payments on debts that are due in October and November. new securities reportThe bitcoin mining company’s share price fell as much as 76% on Thursday morning.

Core said it is exploring alternatives to its capital structure and is working with financial and legal advisers, but said it may have to file for bankruptcy — in which case common shareholders would have to file for bankruptcy. You will lose your investment completely.

“Given the uncertainty regarding the company’s financial condition, there is considerable doubt about the company’s ability to continue operations,” Core said in a filing with the Securities and Exchange Commission.

Bitcoin mining companies such as Core often take on debt in order to remain competitive in businesses that involve large capital expenditures such as mining equipment, equipment, and electricity bills. These companies are running out of cash due to rising electricity prices and the plummeting price of cryptocurrencies.

Bitcoin Mining Core Scientific has warned that it may have to file for bankruptcy.Image: Getty

Chris Brendler, Senior Equity Analyst at DA Davidson, said: Mr. Blendler cut Core’s rating from “buy” to “neutral” last week.

Thursday’s filing came after the company accused bankrupt crypto lender Celsius Network of failing to pay its bills to Core. The mining company said he would pay an additional $1.65 million to host Celsius’ mining operations. According to the core motion Filed in bankruptcy court on October 19. According to the motion, the contract would charge Celsius a flat fee that does not take into account the skyrocketing costs of cryptocurrency mining.

Earlier this month, in response to Core Scientific’s first complaint in the Celsius bankruptcy case, a Celsius attorney said Core Scientific had purchased 10,885 bitcoin mining machines for the troubled company. said to be operating.

Shutting down these machines would cut millions of dollars of revenue, or cash flow, that Celsius has been using to pay for bankruptcy proceedings. report From Celcius’ Counsel Shaw.

Core is asking the court to force Celsius to pay its bills or terminate the contract. The court overseeing the Celsius bankruptcy is scheduled to address the issue at a hearing in November.

Core stocks are down more than 97% since peaking a year ago.

David Hollerith is a senior reporter at Yahoo Finance covering cryptocurrencies and stock markets. Follow him on Twitter. @DsHollers

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