Core Scientific, a prominent bitcoin mining company, has received approval for its Chapter 11 reorganization plans from the Southern District of Texas bankruptcy court. The company expects to re-list its shares on Nasdaq by the end of this month. This development comes as a significant milestone for Core Scientific, which was heavily impacted by the crypto winter.
Under the reorganization plan, Core Scientific will pay off its existing debt in full, and existing shareholders will receive approximately 60% of the new company’s equity, as stated in a press release. Core CEO Adam Sullivan expressed his optimism about the company’s future, stating, “Today’s plan confirmation is a defining moment in our reorganization; we’re poised to emerge by the end of this month as an even stronger company, with a highly motivated team that is aligned for success.”
The approval from the bankruptcy court follows the successful closure of Core Scientific’s proposed $55 million equity rights offering earlier this month. This offering was one of the final steps for the company to complete its reorganization process.
During the peak of the 2021 bull market, Core Scientific operated 143,000 mining rigs, making it the largest publicly traded bitcoin miner by computing power or hash rate. However, as the price of bitcoin plummeted to around $16,000, the company filed for Chapter 11 bankruptcy on December 21, 2022.
Now, as the price of bitcoin has risen to $43,000, Core Scientific is emerging from bankruptcy. The renewed interest from investors, following the approval of spot bitcoin exchange-traded funds (ETFs) by the U.S. Securities and Exchange Commission (SEC), has contributed to the positive outlook for the company. Additionally, the upcoming bitcoin halving event is expected to further boost the market.
Core Scientific aims to maintain its leading position among its peers as it emerges from bankruptcy. The company anticipates operating 182,000 mining rigs for its own operation this year, with plans to ramp up to nearly 1.1 million rigs by 2027. Furthermore, Core Scientific projects annual revenue of nearly $600 million in 2024, with the potential to reach almost $1 billion by 2027.
The re-listing of Core Scientific’s shares on Nasdaq will provide the company with increased visibility and access to capital markets. This will enable it to further expand its operations and capitalize on the growing interest in bitcoin mining.
Overall, Core Scientific’s successful reorganization and plans for future growth demonstrate the resilience of the bitcoin mining industry. Despite the challenges faced during the crypto winter, the company is poised to emerge stronger and capitalize on the increasing demand for cryptocurrencies.