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Bitcoin minor core scientist will close over 37,000 crypto mining platforms owned by bankrupt crypto network lender Celsius as the two companies finally reach an agreement before the courts.
Core Scientific, which hosts rigs for Celsius, filed for Chapter 11 bankruptcy in December and had partially blamed the lender for its financial troubles. The two companies have entered into an accommodation arrangement whereby the mining company transfers certain energy costs in degrees Celsius.
The Battle for Justice.
The two parties have been in a legal battle over the contract as Core claims that Celsius has not been paying for these services since filing for Chapter 11 bankruptcy in July. On the other hand, the lender submits that the minor provided him with less authority than was required by his contract.
Core applied for a hearing on 3 January, claiming that his contract with Celsius cost him over $28,000 a day.
After today, we will not be looking to build up capital. Celsius has agreed to let Core power down the rigs and both sides are close to finalizing a deal to end their hosting relationship,” Chris Koenig, a lawyer for Celsius, said in a bankruptcy hearing on Tuesday.
Celsius Owes Core Over $7.8M
According to court filings, Celsius Network, Core’s biggest client, owes the miner approximately $7.8 million for energy costs tied to the rigs through November. This would mean that the closure of drilling facilities in degrees Celsius could save thousands of dollars a day and generate more revenue if the miner gives space in degrees Celsius to another client.
Experts believe that Core will probably win the case, and the verdict could serve as a legal precedent for other clients breaching contractual hosting agreements with the minor.
The trial is still taking place, It's a great victory for Core Scientific, who are likely to face additional potential litigation from their hospitality customers whose costs have increased. Partners will be less likely to sue them if there is a precedent to shut down the machines while the legal dispute is going on," said Ethan Vera, COO at crypto-mines service company Luxor Technologies says.
