Public Bitcoin mining firms have struggled under the weight of a year-long bear market and are set to end 2022 with a collective debt profile of more than $4 billion, according to a report by Hashrate Index.
Bitcoin miner Core Scientific is the hardest hit among the lot, according to the report. The company owes $1.3 billion to creditors and has filed for Chapter 11 bankruptcy protection, as reported by The Block. The troubled miner is trying to liquidate some of its inventory and plans to sell as much as 1 gigawatt worth of equipment.
Marathon Digital is another Bitcoin miner with a significant debt burden. The company owes about $851 million, but the bulk is in convertible notes, which means its creditors can exchange it for shares in the firm. The company also has $31.3 million of investments in now-bankrupt Compute North. Still, unlike Core Scientific, Marathon is reportedly not in danger of going bankrupt.
Many Bitcoin miners took out loans over the past year. Some were drawn against bitcoin and crypto holdings and have become difficult to service, with the prices of bitcoin and crypto declining significantly since the start of the year. Some now face the task of restructuring their loan agreements to avoid further financial turmoil.
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