Home » Core Scientific Struggles to Survive the Bear Market, Inks $38.6 Million Debt Settlement

Core Scientific Struggles to Survive the Bear Market, Inks $38.6 Million Debt Settlement

by Carolina Lynch

Core Scientific, a prominent bitcoin miner, recently agreed to transfer 27,403 of its mining rigs to the New York Digital Investment Group (NYDIG) to pay off an outstanding debt of $38.6 million. This agreement is subject to approval by the relevant magistrates. Core Scientific had borrowed $77.5 million from NYDIG in 2020 to expand its business, but stopped settling the debt towards the end of 2022 due to shrinking revenue caused by the bear market. This, combined with the low price of the primary cryptocurrency and rising energy costs, led to the company filing for Chapter 11 bankruptcy protection at the end of December. Despite this, Core Scientific managed to secure a $500 million fundraiser led by major financial institutions, such as BlackRock, Ibex Investors, Kensico Capital, and Apollo Capital. Ibex Investors contributed the most, providing almost $100 million. Core Scientific also continued to produce bitcoin, with 1,356 BTC in November and 1,435 BTC in December. This shows that the company is committed to repaying its debtholders, despite its financial difficulties. The improving condition of the cryptocurrency market in early 2023 has also caused a price surge for CORZ, with stocks now worth approximately $0.47 (an 840% increase compared to December figures).

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