Court Approves Bankrupt Miner Compute North’s Restructuring Plan
A US judge has greenlighted Compute North’s restructuring plan after the crypto miner filed for bankruptcy last September. Per the firm’s attorney, James Grogan, the company has agreed with the three remaining creditors after selling assets to address $250 million in secured debt.
Marathon Digital Agrees To Collect $40 Million
Meanwhile, Compute North has twelve major creditors, all of whom had to agree to its restrictions plan. Among these creditors, Marathon settled for $40 million against the $50 million owed.
The last three creditors who accepted the restructuring plan include Decimal Digital, BitNile, and Corpus Christi Energy Park, a mining infrastructure developer. BitNile and Decimal Digital chose Compute North to host the mining rigs they provided, while Corpus Christi Energy Park settled for a $5 million claim.
Compute North will return Decimal Digital’s machines as part of the restructuring plan. Meanwhile, BitNile has agreed to receive a claim of $1 million.
In September 2022, Compute North filed for bankruptcy, citing power-related issues which made it difficult to power Marathon Digital’s machines. Then, Kristyan Mjolsnes, the firm’s chief marketing officer, reported having over 200 creditors.
Although the company has not mentioned any liquidations, it will likely continue to do business at a reduced level. In other news, the crypto industry witnessed a tough 2022.
Recently, the BTC mining sector has witnessed consolidation. However, small miners are currently struggling to remain in operation. For instance, Argo Blockchain borrowed money and sold its Helios mining facility to Galaxy Digital, a crypto financial services firm.
The aim was to help the company gather money to continue its operations. Other crypto miners have also taken similar steps, selling their mined BTC or mining machines to settle outstanding debts.
A New Dawn For BTC Miners?
Meanwhile, there is a merger between Hut 8, a Canadian mining company, and U.S. Bitcoin Corp, an American miner. The deal has valued both companies at a combined total of $990 million.
Hut 8 was initially mining Ethereum before Ethereum transitioned from the PoW to the PoS consensus mechanism. Mike Ho, the co-founder and CEO of Hut 8, said the company managed to weather the recent bear market by exercising discipline.
Consequently, larger public miners resorted to excessive borrowing to finance their costly and newly acquired mining rigs. According to Hashrate Index’s recent examination of mining companies’ debts, Core Scientific, a public mining firm, was identified as the most heavily indebted miner, owing $1.3 billion.
Marathon Digital ranked second with a debt of $851 million. Interestingly, the SEC’s latest action on staking services could herald a new dawn for Bitcoin miners.
Since the beginning of this year, the overall Bitcoin hashrate, which gauges the number of computing resources utilized to verify transactions on a blockchain, has increased from 253,000 to 304,000 petahashes/sec.
Furthermore, the Bitcoin Hashprice Index, which quantifies the earnings miners can generate from a particular amount of computational resources expressed in petahashes per second, has surged 30% in 2023.
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