The bitcoin miner Core Scientific has voiced “substantial doubt” that they would be able to continue their activities over the course of the next year given the present status of the company’s finances.
The corporation disclosed to the United States Securities and Exchange Commission (SEC) on November 22 that it had incurred a net loss of $434.8 million during the third quarter of 2022. This information was included in the quarterly report that the company had filed with the SEC.
After reporting a net loss of $862 million for the second quarter of the year 2022, the total amount of the company’s net losses for the year currently stands at $1.71 billion.
According to the statements made by the company, more liquid resources will be required for it to be able to continue doing business until the month of November 2023. The statement predicted that the company’s financial resources “will be depleted by the of 2022 or sooner. “
It stated that it had doubts about its ability to raise funds through financing or capital markets, citing “uncertainties and current market conditions” which have reduced the availability of those kinds of liquidity sources. It stated that it had doubts about its ability to raise funds through financing or capital markets. Additionally, it indicated that it had concerns about its capacity to generate capital via private placements of its securities.
It was also noted as one of the reasons why it is facing a liquidity pressure, along with the declining price of Bitcoin and an increasing hash rate. These are the three main reasons why it is now undergoing a liquidity squeeze. In addition, it was mentioned that further “substantial doubt exists” regarding its capacity to continue operating because it is “very difficult to predict when or if Bitcoin prices will recover or energy costs will abate.” This is because it is “very difficult to predict when or if Bitcoin prices will recover or energy costs will abate.”
Core Scientific had previously indicated in a filing made with the SEC on October 26 that a combination of factors, such as a low Bitcoin price, rising electricity costs, and a refusal from bankrupt crypto lender Celsius to repay a $2.1 million loan, could result in Core Scientific’s cash resources being depleted. The filing was made because Core Scientific had previously indicated that this could happen “depleted before the end of the year 2022, if not sooner if possible.
In addition to this, it has decided to cease paying payments to some of the businesses that it has borrowed money from in the past. As a direct result of making this choice, the company warns that it runs the risk of being sued for nonpayment and experiencing a rise in the interest rate.
Argo Blockchain is attempting to raise additional liquidity by way of subscription for ordinary shares, and the company has warned that it, like Core Scientific, is at risk of ceasing operations if it is unable to do so. Argo Blockchain is attempting to raise additional liquidity by way of subscription for ordinary shares. Mining bitcoin is difficult in the present market, and Core Scientific is not the only firm that is having problems maintaining its operations in this environment. Argo Blockchain is an example of.
Iris Energy, a mining business based in Australia, is likewise showing signs that it is having difficulty meeting its financial obligations. On November 21, the business informed the SEC in a statement that it had turned off some hardware owing to the fact that the units were not producing sufficient income “a cash flow that is insufficient for the situation.
state of Bitcoin mining, and said in a tweet dated November 22 that this type of response is to be expected anytime the price of Bitcoin is lower than the cost to mine. The tweet noted that this kind of reaction is to be anticipated whenever the price of Bitcoin is lower than the cost to mine.
This article was originally reported on Blockchain News.