Bitmain, Anchorage Digital eye equity stake in Core Scientific comeback from bankruptcy

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Bitmain, Anchorage Digital eye equity stake in Core Scientific comeback from bankruptcy

Core Scientific, one of North America’s largest crypto mining companies, recently filed an updated restructuring plan in its Chapter 11 bankruptcy case.

The comprehensive plan involves major crypto-native companies Anchorage Digital and Bitmain taking equity stakes in Core Scientific.

Core Scientific restructuring plan

According to the restructuring plan, Core Scientific has reached an agreement in principle, subject to final documentation and court approval, for Bitmain to acquire 27,000 S19j XP bitcoin miners from Core Scientific.

The proposed deal includes an exchange of $23.1 million in cash paid in installments and $53.9 million paid in the form of new Core Scientific equity shares at plan value. This arrangement allows Core Scientific to acquire new miners without significant cash outlay.

The proposed plan also includes Anchorage Digital providing a $150 million equity line of credit to Core Scientific after it emerges from Chapter 11 bankruptcy protection. This equity line would give Core Scientific access to additional capital without further diluting existing shareholders.

Core Scientific filed for Chapter 11 bankruptcy protection in December 2022 amid tumbling bitcoin prices, rising energy costs, and disputes with creditors like Celsius Network. The company operates extensive crypto mining facilities in Georgia, Kentucky, North Carolina, North Dakota, and Texas.

Reducing debt and creditor objections

According to the documents, Core Scientific aims to reduce its debt load, which totaled over $1 billion across various financing arrangements and convertible notes, by $30-105 million through the proposed deals with Anchorage Digital and Bitmain.

The plan also details a minimum $55 million equity rights offering for existing Core Scientific shareholders on emergence. B. Riley Financial, the company’s largest unsecured creditor, has agreed in principle to backstop this rights offering and agreed to reduce outstanding balances by $6.3 million. The plan additionally involves B. Riley providing a $25 million delayed draw term loan to Core Scientific as it exits bankruptcy.

However, some Core Scientific creditors have objected to parts of the plan, contending their claims are undervalued, and the deadline for filing objections is set for Oct. 3. The restructuring plan aims to maximize recovery for all stakeholders while ensuring the continuation of Core Scientific’s business operations.

If confirmed, the deals with Anchorage Digital and Bitmain would allow crypto-focused investors to gain exposure to Core Scientific’s extensive mining infrastructure while shoring up the bankrupt firm’s capital structure.

Confirmation of the whole plan remains pending based on creditor acceptance and court approval.


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The Cambridge Bitcoin Electricity Consumption Index (CBECI), which tracks global Bitcoin energy consumption, has undergone its first major update since 2019, influenced by evidence pointing to frequent overestimating Bitcoin’s electricity usage.

A new report is said to shed light on the evolution of Bitcoin mining and to clarify the rationale behind the changes in CBECI’s methodology, providing an in-depth analysis of the transition of Bitcoin mining hardware – from CPUs to GPUs, then FPGAs, and finally to the current state-of-the-art ASIC miners.

Mining efficiency evolution.

The CBECI noted that the efficiency of ASICs experienced a rapid surge initially but has since seen a tapering in growth as we reach the limitations of semiconductor technology. This slowdown has direct implications on the lifespan of miners, affecting the assumed replacement cycles, with estimates ranging from 1.5 years (academia) to 3-5+ years (industry).

Its methodology has been revised to account for this increased computing power of newer models, such as the Antminer S19 XP, which boasts a 140 TH/s capacity compared to the 11.5 TH/s of the 2016 Antminer S9.

CBECI further asserted that the introduction of ASICs triggered an exponential growth in Bitcoin’s hashrate, from less than 1 EH/s in 2010 to over 300 EH/s in early 2023, revolutionizing mining from a home computer activity to a professional endeavor.

Hashrate growth.

While a higher hashrate enhances Bitcoin’s security, it also escalates mining difficulty and the computing power necessary to earn block rewards. Comprehending these drivers of hashrate growth was reportedly crucial to reevaluating the CBECI methodology.

According to the report, investigations into hashrate growth factors revealed a strong correlation between the increase in imported mining hardware to the US and the overall network hashrate growth. Additionally, sales data from Canaan Creative indicated that their latest models accounted for nearly 45% of their hashrate sales in 2021, suggesting that these more efficient models likely contribute more to hashrate growth than previously assumed by the CBECI methodology.

Upon applying the new CBECI methodology, the 2021 estimate was significantly reduced by 15 TWh, or 14% (from 104 TWh down to 89 TWh), and the 2022 estimate was cut by 9.8 TWh, or 9% (from 105.3 TWh down to 95.5 TWh).

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