Bitmain, the world’s premier digital currency mining servers manufacturer, is set to invest a whopping $53.9 million in Core Scientific, a leading player in blockchain computing data centers.
This move comes despite Core Scientific, a US-based crypto mining firm, filing for Chapter 11 bankruptcy following a prolonged crypto winter and the failure of Celsius.
Bitmain Bets Big on Core Scientific Bitcoin Mining Operations
“Bitmain’s product quality, attention to service and responsiveness are critical to our success in supporting the Bitcoin Network,” said Adam Sullivan, CEO of Core Scientific. He added:
“The new miners we are securing with this agreement will enhance our mining fleet’s efficiency as we continue to prepare for next year’s halving event and beyond.”
The investment deal, a combination of equity and cash, will finance the purchase of new and more efficient Bitcoin mining equipment. Bitmain will also supply Core Scientific with 27,000 Bitmain S19J XP 151 Bitcoin mining units.
The deal is expected to gain approval in Q4 2023. Furthermore, it demonstrates Bitmain’s ongoing commitment to the North American crypto-mining industry.
Read more: How To Build a Mining Rig: A Step-by-Step Guide
Core Scientific Paddles Upstream
In a bid to settle litigation, Core Scientific will sell its Texas Bitcoin mining data center to Celsius for $14M. The center, which includes 215 megawatts of available power production, could become one of the biggest mining facilities in Texas.
“We look forward to deepening our strategic relationship with Core Scientific, our long-standing U.S.-based partner,” said Max Hua, Bitmain CEO.
“Their professionalism, integrity, and commitment to the success of their hosting customers and to the growth of the Bitcoin Network is unsurpassed in the industry.”
The bankruptcy filing by Core Scientific, attributed partly to Celsius’ inability to pay, is set to avoid liquidation. This will allow the business to continue while negotiating a deal with the principal creditors.
This move followed a warning from Core to its equity stockholders about the risk of losing all of their investments. It blamed this on the financial instability caused by the failure of Celsius.
Despite the hurdles, Core Scientific remains a significant contributor to the strength and stability of the Bitcoin network. The firm’s resilience and the new investment from Bitmain could potentially help it navigate its current challenges and contribute to the long-term growth of the Bitcoin network.
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