Stakeholders in embattled bitcoin miner are bracing for bankruptcy: Bloomberg
Quick Take
- As Core Scientific considers bankruptcy, bondholders are reportedly seeking legal protection.
- Austin-based firm was responsible for roughly 10% of bitcoin’s global hashrate at its peak.
Bondholders for bitcoin miner Core Scientific have tapped a legal firm to advise on a potential bankruptcy, according to a Bloomberg Law report.
The news comes days after Core Scientific revealed in public filings that it may run out of cash and be forced to file for bankruptcy. The Austin-based firm was responsible for roughly 10% of bitcoin's global hashrate at its peak.
Source: TradingView
Core Scientific is working with Weil, Gotshal & Manges as legal advisers and PJT Partners as financial advisers as it explores potential strategic alternatives to raise money. The options may include exchanging existing debt for equity or additional debt, asset sales, equity or debt financing.
The company said in its filing last week that it held 24 bitcoins and approximately $26.6 million in cash as of Oct. 26. That was down from 1,051 bitcoins and approximately $29.5 million in cash as of Sept. 30.
Core Scientific stock plunged on the news, dropping to below 20 cents after having peaked at $15 amid the crypto bull market last November.
A representative for Core Scientific did not immediately respond to a request for comment.
© 2023 The Block. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.