According to a recent court documentson January 25 the deceased Bitcoin Mining company Core Scientific filed an emergency application seeking permission to sell Bitmain vouchers worth a total of $6.6 million.
As stated in the petition, various restrictions have been added to the coupons making them useless for Core Scientific operations.
To be more specific, the coupons can only be used to pay for 30% of any new S19 Miners order placed with Bitmain. They cannot be redeemed for cash with Bitmain under any circumstances.
Core Scientific Says Crypto Winter Affected Miners
According to the filing, the crypto winter was responsible for an increase in the number of S19 Miners being put up for sale on the secondary market, causing a decline in prices.
As a consequence of this, recent transactions on the Coupon Exchange using S19 Miner coupons have been made at prices ranging from 15% to 25% of the coupon face value.
As for the coupons, they can only be used for S19 devices, which have a lower hash rate compared to the most current models produced by Bitmain.
The firm stated that the Debtors do not believe that using their liquidity to acquire additional S19 Miners is the best use of the Debtors’ funds, even with the availability of the Bitmain Coupons.
Additionally, Bitmain’s vouchers will become invalid between March and April 2023, which is when the company thinks it will be out of its Chapter 11 restructuring.
Additionally, Core Scientific said it would not purchase any new S19 miners while it is operating under Chapter 11 or after it emerges from that chapter.
Additionally, the crypto company said that it has been in negotiations with Bitmain and two potential third parties who are interested in purchasing the coupons at a deep discount.
Specifically, the sale of $1.9 million worth of Bitmain coupons for $285,000 and the sale of $4.8 million worth of coupons for around $713,000, which accounted for approximately 15% of the total price of coupons sold.
Core dismantled Celsius mining rigs
In a related development, just a few weeks ago, the Bitcoin miner announced that, in accordance with an agreement reached between the two bankrupt companies, it intends to halt the operation of 37,000 bitcoin mining machines that had belonged to crypto lender Celsius.
In view of the fact that Celsius has been unable to make the periodic payments required by the hosting contract, Core Scientific is entitled to compensation of approximately $7.8 million for the power and hosting costs it has incurred.
Lawyers representing Core Scientific argue that shutting down the bitcoin mining equipment would result in significant cost savings for the company, and that the company has the potential to earn $2 million per month by renting out the hosting stands to another mining operation.