BTC Miner Core Scientific faces cash crunch, lost $1.7 Billion in 2022
- The Miner suffered a net loss of $862 million in the second quarter, followed by a net loss of $434.8 million over the third quarter.
- The firm cites low Bitcoin prices, increased electricity costs, an increase in the global Bitcoin hash rate, and Celsius’s refusal to repay loans are the main reasons for the cash crunch.
BTC Miner Core Scientific, in its quarterly report filed with the United States Securities and Exchange Commission (SEC), has disclosed that its total net losses for 2022 stand at $1.71 billion.
In the filing, the Miner stated that it suffered a net loss of $862 million in the second quarter, followed by a net loss of $434.8 million over the third quarter of 2022. The Texas-based company pointed out that it will require additional liquidity and anticipates that its cash resources “will be depleted by the end of 2022 or sooner.”
Talking about its bleak Future, Core Scientific stated that it had doubts about its ability to raise funds through financing or capital markets owing to “uncertainties and current market conditions.”
This is not the first time Miner has discussed the possibility of the firm facing a bankruptcy crisis soon. About a month ago, the Bitcoin Miner first warned of bankruptcy risk, sending its shares plummeting around 80%. The Miner had 1,051 BTC and $29.5 million in cash at the end of September.
Last month, in an SEC Filing, the Miner had said that its cash reserves will likely be “depleted by the end of 2022 or sooner.” The company blamed low Bitcoin prices, increased electricity costs, an increase in the global Bitcoin hash rate, and the refusal of bankrupt crypto lender Celsius to repay a $2.1 million loan as the main reasons behind the cash crunch.
To reduce unnecessary costs and ease financial pressures, the Miner has taken steps to decrease operating costs, delay capital expenditures, and increase hosting revenues. However, Core Scientific is only among the numerous miners finding it difficult to navigate through the harsh crypto market conditions.
Compute North, one of the world’s largest operators of crypto-mining data centers, filed for Chapter 11 bankruptcy in September. Iris Energy, an Australia-based Bitcoin mining firm, has decided to cut its mining hardware after receiving a notice of default on its $108 Million Loan. Argo Blockchain and Greenidge Generation have also openly discussed their cash troubles. More BTC miners will join this growing list of firms suffering from liquidity scare if bitcoin prices don’t increase shortly or drops even lower.