Bitcoin Miner NFN8 Files for Chapter 11 Bankruptcy

Bitcoin mining company NFN8 has filed for Chapter 11 bankruptcy protection in Texas. The firm plans to sell its assets under court supervision while continuing limited operations. Court documents show NFN8 secured $2.75 million in debtor-in-possession financing to support the restructuring process.

NFN8 Group Inc. and its subsidiaries submitted the filing on February 2. The case is being administered by restructuring firm Stretto. Funding was provided by Twelve Bridge Capital and will be used to cover operating expenses during the asset sale.

Lease-Back Financing and Hashprice Pressure

NFN8 operated mining facilities in Texas and Iowa. The company owned more than 5,000 ASIC miners outright and managed additional units through leases and joint ventures. A key part of its strategy involved sale-leaseback financing with over 250 counterparties.

Under this structure, NFN8 sold mining equipment to investors and leased it back under fixed contracts. Lease payments depended heavily on mining revenue. However, declining hashprice reduced cash flow and increased financial stress.

The situation worsened after the April 2024 Bitcoin halving. While the event was anticipated, mining revenue recovered slower than expected. As a result, margins remained compressed throughout 2024 and 2025.

Fire, Legal Claims and Tax Disputes

Operational risks escalated after a fire damaged NFN8’s main leased facility in Crystal City, Texas. The incident occurred between late December 2025 and early January 2026. According to filings, mining capacity fell by nearly 50%.

The company stated it maintains insurance coverage but has not confirmed when proceeds will be received. At the same time, several sale-leaseback participants filed lawsuits alleging contract breaches and financial misconduct. The dispute is now subject to arbitration.

NFN8 also disclosed a disputed $3.2 million unsecured tax claim from the Internal Revenue Service related to 2021 liabilities.

The company estimates its assets are below $50,000, while liabilities range between $1 million and $10 million. The creditor count is listed between one and 49 parties.

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