Bitcoin mining firm’s core science shares plunge amid bankruptcy rumours
The crypto winter that began in early 2022 has resulted in several financial problems, including Bitcoin mining companies. Many crypto firms have struggled, while others had to close shop. The crypto community felt the impact, mainly through many crypto firms including Celsius Network, Three Arrows Capital, Voyager Digital, etc.
Blockchain and artificial intelligence company Core Scientific is among the affected companies. While for some other firms there was a need to reduce staff and suspend withdrawals, Core Scientific is currently considering bankruptcy.
Details of the case
The chances of Core Scientific filing for bankruptcy are high, as the company claimed that it may be out of funds before the end of 2022. However, it stated that the main reason for the struggle is the current crypto market crash.
Maybe the case of crypto crash would have been handled but there are other factors to face. One example is increased electricity costs. The integration of all current negative events has brought the company into a state of dilemma.
The company disclosed this information in its filing with the Security and Exchange Commission in the United States.
In general, not all Bitcoin miners have their best experience. Sources reported that another major factor contributing to the problem is the increase in the Bitcoin hash rate. As a result, there is a tendency for Bitcoin to witness more declines as holders of the token may start considering the selling option.
The stock dive
Running out of cash is part of the company’s ongoing crisis. As a result, the company’s shares (NASDAQ: CORZ ) fell rapidly from the last market watch.
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According to data, the share price has fallen by 71% in 24 hours. The current price of CORZ stock is $0.20, according to data from Bloomberg. The company can only hope for a quick restoration now.
Core Scientific Bitcoin Holdings
The total Bitcoin holdings of the company have dropped significantly. Last September, when the firm filed with the United States SEC, it held about 1,501 Bitcoins. As of Thursday, the total BTC holdings of the company are $24 and $26.6 million as its total funds.
Currently, the company has outstanding debts and according to the situation, it will not be able to clear these debts. Moreover, it will not be possible to pay the equipment suppliers even after the due dates at the end of October and November.
In the meantime, the company is seeking ways to remedy the ongoing crisis. Core Scientific is considering restructuring its finances, hiring a strategic advisor and raising additional capital.
featured Image From Pixabay, Charts From Tradingview
