According to Bloomberg, Core Scientific put a stop to 37,000 mining equipment from the cryptocurrency business Celsius that was about to go bankrupt.
Core is able to transfer part of its electricity costs to Celsius thanks to their storage agreement. Nevertheless, Core Science lawyers claim that the bankrupt cryptocurrency corporation has not paid those bills since it requested Chapter 11 protection in July.
In its bankruptcy filing last month, Core Scientific partially attributed its recent financial collapse to Celsius's non-payment due to the recent insolvency of Bitcoin miners hosting third-party rigs.
The case might serve as a guideline for other Core Science clients who want to challenge the terms of a hosting contract with the business. The cost of running electricity-intensive mining operations has increased significantly over the past year due to skyrocketing energy prices brought on by harsh weather patterns and Russia's invasion of Ukraine.
As of the company's operational update on November 7, 100,000 servers, or around 41% of Core's overall fleet, were devoted to hosting its clients.
Celsius owes Core at least $7.8 million in electrical charges tied to the rigs through November, per court records. If the rigs were turned off, Core would save thousands of dollars per day, and if it could rent Celsius' current facility to other clients, it would earn an additional $2 million per month.
After today, "We're not seeking to make a dollar off of Core," said Celsius attorney Chris Koenig during a bankruptcy hearing on Tuesday. Both parties are close to concluding a contract to discontinue their hosting partnership, and Celsius has agreed to let Core power down the rigs.
