Crypto miner Core Scientific will emerge from bankruptcy in January, according to a press release from the company on Thursday.
New opportunities ahead
According to Thursday’s statement, the crypto miner has “reached an agreement in principle with all key stakeholders on the terms of a global settlement for all of its chapter 11 cases.”
The announcement marks the end of a tedious bankruptcy process that began in December 2022 for the Austin-based company, which cited low bitcoin prices, revenue, and a $7 million unpaid debt from Celsius Network as the reason for the filing.
“The global settlement removes key hurdles to our anticipated emergence from Chapter 11 in January,” said Adam Sullivan, Core Scientific’s Chief Executive Officer. “With our team highly focused on operational excellence, a post-emergence pathway to de-lever our balance sheet, and a plan for continued growth in 2024 and beyond, we are excited to pursue the opportunities ahead of us in the new year.”
A contentious legal battle comes to an end
News of the settlement comes just a few months after Celsius Network and Core Scientific reached a settlement following an acrimonious legal battle regarding unpaid fees in September, with Core Scientific agreeing to sell Celsius Network their $14 million Cedarvale mining site as well as release all claims against the crypto lender.
“After months of negotiations, Celsius and Core have now consensually resolved their long-running disputes and agreed to a global settlement that will fully resolve this litigation,” a September court filing reads.
For their part, Celsius Network, which was once estimated to be a $3 billion enterprise, was forced to stop all customer withdrawals due to “extreme market conditions.”
Just one month later, the troubled crypto lender filed for bankruptcy in July 2022.
However, just last month, a U.S. bankruptcy judge approved Celsius Network’s restructuring plan, clearing the way for the company’s path out of bankruptcy.
Crypto winter’s end?
Both Core Scientific and Celsius Network’s struggles were part of a much larger season of turbulence for the crypto industry, with numerous billion-dollar crypto organizations collapsing under the weight of a dreaded crypto winter.
Most notably, Sam Bankman-Field’s crypto exchange, FTX, collapsed in a whirlwind run on the bank in November 2022, thanks largely in part to rival Binance founder, Changpeng “CZ” Zhao blowing the whistle about the company’s operations in a post on X.
However, this year Zhao was himself arrested for violating a number of federal laws and was forced to step down from his position as CEO.
The latest news from Core Scientific offers a glimmer of hope for the crypto industry’s year ahead, with the crypto miner’s bankruptcy plans set to finalize in mid-to-late January.
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