Core Scientific's Lender Wants to Offer Miner $72 Million to Avoid Bankruptcy.
Investment bank B Riley said the majority of struggling miners' concerns are self-imposed and resolvable.
Financing to Bitcoin miner Core Scientific in order to prevent bankruptcy and protect Core Scientific's value for its investors.
In a letter dated December 14 outlining the conditions of the financing deal, B. Riley, a major lender to Core Scientific, stated that it is prepared to fund the first $40 million "immediately, with zero contingencies."
The trading platform claimed that the $32 million in unclaimed funds will be subject to the BTC miner's suspension of all payments to lenders for equipment while Bitcoin prices are below $18,500.
Bitcoin's price recently exceeded $18,500 on November 9 before plummeting more than 14% in a single day.
B. Riley's analysis of Core Scientific's situation was damning, claiming the company had adopted "an aggressive, ill-conceived plan to continue to build out power facilities and grow miners while never selling Bitcoin on hand and never hedging prices."
It stated that as a result of this strategy, Core Scientific was compelled to sell 9,618 BTC in April for a price of $362 million, resulting in a huge loss for the miner.
In a quarterly report filed on November 22, Core Scientific acknowledged that it lacked the funds necessary to operate through 2023. Additionally, it stated that it was unsure of its capacity to raise funds through stock markets or finance.
The company cited the low price of Bitcoin, rising electricity prices, and Celsius's failure to repay a $2.1 million loan as the reasons for its financial difficulties in a filing on October 26.
The share price of Core Scientific had also decreased by 97.7% from $11.02 to $0.25 since the beginning of 2022.
Read also: ETHEREUM PRICE ANALYSIS-$1,290: Bears are hammering as a double top pattern appears on the chart