Texas-Based Crypto Mining Firm Compute North Officially Files for Bankruptcy
The fall in prices of Bitcoin made it difficult for the company to continue to support its crypto mining operations. Now Compute North joins the group of companies that have had to close operations in the framework of the crypto winter.
- Compute North files for bankruptcy in a Texas court in the US.
- The company was one of the largest mining companies in the state of Texas
- Crypto winter has led several companies to file for bankruptcy
The operating company of one of the largest crypto mining centers in Texas, ComputeNorth, declared bankruptcy due to difficulties in sustaining its activities, in the context of the fall in the price of Bitcoin and the main cryptocurrencies.
Compute North files for bankruptcy
According to published information through the middle CoinDesk Compute North, He applied to the corresponding court for the southern district of Texas for the protection associated with the declaration of bankruptcy. Being one of the largest companies in the sector, the company had closed important agreements with some commercial partners that would be affected by the insolvency situation.
Among business partners, Computer North entities such as Marathon Digital, Compass Mining, Atlas Mining, The9, and BitNile Holdings, all carry out crypto-mining activities based on Bitcoin.
It is important to note that the company announced in February of this year a new round of financing for USD $85 million, as well as the raising of another USD $300 million in debt financing.
As such, Compute North It has four facilities in the US, of which two are in Texas, one in South Dakota, and the other remaining in the state of Nebraska. It is estimated that this situation may have negative implications for the industry at the local level, especially now that the implementation of state policies in relation to crypto mining is on the table. Proof-of-Work (PoW).
The effects of the crypto winter
Hand in hand with the adoption of Bitcoin, Interest in mining has also grown in recent years. BTC. This has led large companies with the possibility of acquiring a lot of equipment to install crypto-mining farms, but this activity involves significant operating expenses that can often only be maintained by selling a good part of the funds generated.
Therefore, the fall in the prices of Bitcoin it has compromised the viability of operations for many entities beyond the mining sector. The hardest hit were financial services companies based on cryptocurrencies, which had to suspend their services to avoid running out of liquidity in the face of the market crash.
But among the most catastrophic cases that had to declare bankruptcy after this crypto winter are entities such as Celsius NetworkThree Arrows Capital, and VoyagerDigital. The protected status will allow them to finalize operations and resolve certain matters in order to subsequently duly indemnify the affected persons and entities.