Crypto Miner Core Scientific Settles $20M Bankruptcy Dispute

  • Sergey Maga
  • 10:57 Mar 21, 2023
Crypto Miner Core Scientific Settles $20M Bankruptcy Dispute

Core Scientific, a major Bitcoin mining company, has reached a $20 million settlement with its energy negotiator, Priority Power Management, in an approved bankruptcy court decision. The settlement resolves a dispute over payments related to two Texas-based mining facilities intended to receive 1,000 MW of power to boost Core Scientific’s mining capacity. The United States Bankruptcy Court for the Southern District of Texas, granted permission for Core Scientific to transfer $20.8 million worth of equipment to Priority Power.

According to a declaration by Core Scientific executive Michael Bros, the company engaged Priority Power in June 2021 for the exclusive management, consultation, and development of infrastructure to meet its energy demands. However, by May 2022, it became evident that the facilities would not receive the expected power load, leading Core Scientific to halt payments to Priority Power due to significant losses.

As part of the settlement, Core Scientific will introduce Priority Power to any future acquirer of its Texas sites for potential energy management and consulting agreements. Additionally, Priority Power will retain $514,000 earned by curtailing power for Core Scientific and receive reimbursement for legal fees and out-of-pocket expenses up to $85,000.

This is not the first time Core Scientific has been compelled to surrender equipment. In February, the company reached a deal with the New York Digital Investment Group (NYDIG) to repay a $38.6 million debt by handing over more than 27,000 mining rigs that served as collateral.

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