Breaking: Bitcoin miner Core Scientific is filing for Chapter 11 bankruptcy

As one of the largest publicly crypto mining firms in the United States, Core Scientific is unexpectedly filing for Chapter 11 bankruptcy protection in Texas Wednesday morning. Before this, the crypto world has already experienced a series of bad events, including the collapse of FTX and BlockFi, and the massive layoffs from Bybit. Is the collapse of Core Scientific because of the Butterfly effect？

Some reports believed that the reason for the bankruptcy is because of the rising price of cryptocurrencies and energy. Some reports believed that the reason for the bankruptcy is because of the rising price of cryptocurrency and energy, and the rising price is because of the pandemic and the Russia-Ukraine war.

About Core Scientific

(Website of Core Scientific) Core Scientific, based in Seattle, U.S., is a bitcoin mining company offering blockchain and artificial intelligence hosting, transaction processing, and application development. It was founded in 2017 by Darin Feinstein and Mike Levitt and has raised over $115 million in total funding. Its Mining segment consists of digital asset mining for its own account. The Company mines digital assets for its own account and provides hosting services for other large-scale miners. According to CNBC, the stock of this company is down 98% this year.

Interestingly, in August of this year, Core Scientific CEO Mike Levitt claimed “we are here to help the development of renewable energy.” On Bloomberg TV Just a few months later, Core Scientific suddenly declared bankruptcy, leaving people wondering what had happened to the company.

Cash Flow

According to CNBC, this company had previously said in a filing in October that holders of its common stock could suffer “a total loss of their investment.” A person familiar with the company's situation said the company is still generating positive cash flow, but that cash does not suffice to repay the financing debt owed on the equipment it was leasing. A deal will be reached with senior security noteholders during which the company will not liquidate, but continue to operate normally.

Many people believe this chain of events, including the collapse of Core Scientific, led to the FTX collapse. It seems that the winter of crypto may not be over.