According to Reuters, the US bitcoin miner Core Scientific received approval from a group of current creditors on December 23 for a $37.5 million loan to support the company's Chapter 11 bankruptcy.
During a hearing in Houston, Texas, U.S. Bankruptcy Judge David Jones granted Core Scientific's provisional bankruptcy financing. Although the company's lawyers claim they're open to better financing choices from other lenders, they will seek final approval for the loan and be permitted to borrow an additional $37.5 million in January.
Despite Core Scientific's recent difficulties and the declining price of bitcoin, Kris Hansen, who offered the new loan on behalf of creditors, said in court that existing stakeholders still have faith in the company's long-term survival.
On December 21, Core Science announced that it has filed for Chapter 11 bankruptcy protection. The sudden decline in the price of bitcoin, the high cost of energy used in bitcoin mining, the $7 million in unpaid debt from its Celsius Network, and the intention to convert the majority of the debt into equity were the main drivers behind the filing.
The biggest cryptocurrency mining business in the country has revealed that Core Scientific, which filed for Chapter 11 bankruptcy on December 21, can sell some under-construction facilities with a capacity of up to 1 Gigawatt.
With a mining capacity of about 800 to 850 megawatts, Core Scientific is now the biggest in the sector. The mine it can offer, with a mining capacity of up to 1 billion watts, is anticipated to go online in 2023.
The company issued a warning in October that it would run out of money at the end of the year and that bankruptcy was a possibility, but last week, with B., things appeared to have changed. Riley is extending Core Science's life by two years and preventing the company from going out of business by offering the miners a $72 million funding package.