(Reuters) – Core Scientific Inc, one of the biggest publicly traded crypto mining companies in the United States, will soon file for Chapter 11 bankruptcy protection, CNBC reported, citing one person familiar with the matter.
The company will file for bankruptcy protection in Texas early on Wednesday morning but will not liquidate, the report published late on Tuesday said, adding that it will continue to operate normally while reaching a deal with senior security noteholders.
The development comes after one of the largest creditors of Core Scientific B. Riley Financial Inc had offered $72 million last week to avoid the bitcoin miner’s bankruptcy.
Core Scientific did not immediately respond to a Reuters’ request for comment outside business hours.
The Austin, Texas-based miner, which operates in Georgia, Kentucky, North Carolina, and North Dakota, mines digital assets, including coins like bitcoin and ethereum.
Bitcoin miners have been under severe pressure as their profitability dropped amid a slump in cryptocurrency prices and soaring energy rates. The extreme market conditions have also led to bankruptcies of other major cryptocurrency lenders such as Celsius Network and Voyager Digital Ltd.
Core Scientific was also impacted by the litigation with Celsius Networks LLC and its affiliates.
(Reporting by Siddharth Jindal and Maria Ponnezhath in Bengaluru; editing by Uttaresh.V)