Bitcoin Mining Firm Core Scientific Lost $1.7 Billion in 2022

Public-traded Bitcoin mining company Core Scientific has lost about $1.7 billion since the start of the year, according to its quarterly report filed with the United States Securities and Exchange Commission (SEC) on Tuesday.

The filing shows that the firm recorded its second consecutive quarterly loss at the end of Q3. The Bitcoin miner lost $435 million in Q3 and $862 million in Q2, bringing its net loss for the year to a staggering $1.7 billion.

Core Scientific Seeks Fresh Capital

Core Scientific said it needed fresh capital before continuing operations this month. The firm also noted that it anticipates its existing cash resources to be depleted sooner or by year-end. 

“Given the uncertainty regarding the Company’s financial condition, substantial doubt exists about the Company’s ability to continue as a going concern through November 2023,” the firm said.

The Bitcoin mining company holds $32 million in cash and 62 BTC as of October, down from 8,000 at the beginning of the year. The firm attributed its losses to the severe decline in BTC’s USD value, rising energy costs, and hash rates.

Core Scientific May Consider Bankruptcy 

Following the significant drop in the price of BTC, which was triggered by macroeconomic headwinds, the miner has taken several steps to boost liquidity and cope with the market.

For instance, Core Scientific announced the sale of 7,202 BTC (approx. $167 million) in July at an average price of approximately $23,000. At the time, the firm noted that sales proceeds would be used to pay for ASIC servers, capital investment, and debt repayments.

The company has been unable to clear its debts, which amount to approximately $1 billion. The miner previously revealed that it may file for bankruptcy if it cannot raise capital to repay its creditors. 

Bitcoin Mining Firms Struggle Amid Bear Market

Meanwhile, Core Scientific is not the only mining firm struggling amid the intense crypto winter. In June, Canadian Bitcoin miner Bitfarms offloaded $62 million of its BTC to reduce its debts and maintain liquidity.

Two months ago, the largest operator of crypto-mining data centers, Compute North, filed for Chapter 11 bankruptcy in Texas.

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newsby.top • 2022