- A Bitcoin (BTC) mining data center company named Compute North has filed for Chapter 11 bankruptcy.
- The corporation has assets valued between $100 and $500 million but owes about 200 creditors $500 million.
The CEO of Compute North, a firm that operates data centers for Bitcoin (BTC) mining, Dave Perrill, has resigned and the company has filed for Chapter 11 bankruptcy.
The Minnesota-based business will carry on as it develops a strategy to pay off creditors. It claimed in the statement to owe at least 200 creditors up to $500 million. According to the filings, Compute North determined the value of its assets to be between $100 million and $500 million.
In February, Compute North announced a $385 million capital raising, made up of an $85 million Series C stock round and $300 million in debt financing.
However, it failed due to miners’ struggles to subsist in the face of falling bitcoin (BTC) prices, rising power prices, and record mining challenges. The filing is anticipated to have detrimental effects on the sector.
According to a tweet from Bloomberg Business Reporter David Pan, one of the reasons Compute North filed for bankruptcy was the delay in the startup of its 280 MW mining facility in Texas, primarily because of approval concerns.
The representative noted that although CEO Dave Perrill resigned earlier this month, he will remain on the board. According to the spokesman, Drake Harvey, who has served as Compute North’s chief operating officer for the past year, has been promoted to president.
According to its website, Compute North operates four facilities in the United States: two in Texas and one each in South Dakota and Nebraska.
Compute North’s bankruptcy petition makes it the most recent significant victim of the continuing crypto winter, following earlier this year’s filings by cryptocurrency broker Voyager Digital, cryptocurrency lender Celsius Network, and cryptocurrency hedge fund Three Arrows Capital.
Partners of Compute North have stated that their business operations would not be impacted by the firm’s bankruptcy.
Marathon Digital and Compass Digital, two bitcoin mining companies, tweeted that the bankruptcy of the data center operator will not have an effect on their mining activities.