Core Scientific Is Bankrupt but Remaining Functional
Core Scientific – one of the world’s biggest crypto mining enterprises – has filed bankruptcy in recent weeks but is still expected to continue its mining operations in the region of Grand Forks, Texas.
Core Scientific Can Continue to Operate as Normal
The company first began pursuing chapter 11 bankruptcy protections in the final weeks of December. Core Scientific has experienced a net loss of nearly half a billion dollars at the time of writing stemming back from September of 2022.
While the courts are recognizing the company’s lack of finances, Core Scientific says that what the organization its currently undergoing will only affect its balance sheet, not its primary operations, and thus it will be able to continue running its data centers and extracting new units of crypto. In a statement, head of mining Russell Cann explained:
Our business model, [the] day-to-day operations of our facilities, and corporate structure will continue functioning as normal. The Grand Forks operations and employees should not be adversely impacted by this procedure.
Keith Lund – president and CEO of the Grand Forks Region Economic Development Corporation (EDC) – said his agency has been in touch with Core Scientific ever since the company first entered its bankruptcy proceedings. He said:
They report that the Grand Forks project was one of their best, and they plan to continue operations through the Chapter 11 process. Time will tell, but that’s the expectation.
Cann continued his statement by explaining that his company’s bankruptcy is very similar with those of Chrysler, Delta Airlines, and Hertz. He says all these firms were allowed to continue their operations and that nothing should get in the way of Core Scientific staying afloat. He mentioned:
The company will continue to operate during the process, restructure its balance sheet, and hopefully prosper after the process is complete.
2022 was the year of crypto bankruptcies, with many digital asset-based firms entering court rooms and engaging in the appropriate protocols to keep themselves safe from angry customers and creditors alike. Among the names to come to mind include Celsius and Block Fi.
This Keeps Happening!
Celsius caused people to raise their eyebrows last summer when it announced it was halting all withdrawals and preventing people from gaining access to their funds. Things didn’t quite stop there, however, as just a few weeks later, the company said it was engaging in bankruptcy filings to ensure that it could stay operational while preventing the wrath of creditors that weren’t receiving their funds back.
The biggest bankruptcy came in the form of FTX, the once popular digital currency exchange that rose to fruition within three years. The company was marred with fraud in late 2022 and it was announced that the firm would be filing bankruptcy after a purchase deal with Binance fell through.
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