Core Scientific is filing for Chapter 11 bankruptcy protection in Texas on Wednesday, December 21. It is one of the largest publicly listed crypto mining companies in the U.S. Core Scientific has decided to file for bankruptcy due to falling crypto prices and rising energy prices that deteriorated its finances.
Despite the $72 million in financing from its lender B. Riley last week to avoid bankruptcy, the crypto miner was unable to work efficiently and will work on restructuring, reported CNBC. Core Scientific plans to keep mining until it restructures its balance sheet.
Core Scientific’s market cap dropped to $78 million on Tuesday, down from a $4.3 billion valuation in July 2021 when it went public. The CORZ stock price has fallen more than 98% in the last year. On Tuesday, the stock price ended at $0.21, up 3.07%.
According to a person familiar with the company’s situation, the company is still generating positive cash flow. However, cash is insufficient to repay the financing debt owed on mining equipment it was leasing. Core Scientific will not liquidate and operate normally until reaching a deal with senior security noteholders, which hold the majority of the company’s debt.
The post Breaking: Core Scientific Filing For Chapter 11 Bankruptcy In Texas Today appeared first on CoinGape.
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