This Bitcoin Mining Firm Filed for Chapter 11 Bankruptcy

Lavina Daryanani
Source: DebtHammer

Winter has been harsh to companies in the crypto space. Right from instigating liquidity crunches to denting balance sheets, it has hampered the day-to-day operations of several companies. Back in July, for instance, two well-known names from the space—Voyager Digital Assets and Celsius Network—filed for Chapter 11 bankruptcy.

On its part, Chapter 11 filings allow a company to keep operating while it comes up with a plan to repay creditors. 

Compute North files for bankruptcy

Now, in what is the latest development, Bitcoin mining hosting provider Compute North Holdings Inc. has filed for Chapter 11 bankruptcy. Per its petition, the company’s assets are worth between $100 million and $500 million. Compute North, notably, owes approximately $500 million to at least 200 creditors.

Compute North’s head of marketing and sustainability—Kristyan Mjolsnes—said in an email to Bloomberg,

The company filed bankruptcy to stabilize its business while it restructures under court protection.

Per details on the website, Compute North started in 2017 as a crypto mining operation. It then gradually expanded to provide co-location services that provided low-cost power for data centers.  Earlier this year, the mining infrastructure firm had raised $385 million in equity and debt funding to finance its new Bitcoin mining data centers.

Then in April, the company announced that construction was underway on a 300-megawatt co-location facility in Granbury, Texas. Back then, Dave Perrill—CEO and Co-Founder at Compute North—said,

We are developing the next generation of data centers meeting the unprecedented needs of next-generation technology at a time when the demand for energy efficiency and stabilizing the energy grid has never been higher.

Marathon Digital Holdings is, notably, one of Compute North’s clients. In a recent tweet, the Bitcoin mining firm stated that Compute’s filing will “not impact” its current mining operations. It added,

We are in communication with the hosting provider and monitoring their progress as they work through this process.