Core Scientific, the bankrupt Bitcoin miner, is anticipating finalizing a restructuring plan by September, aiming to emerge from proceedings with an additional $46 million due to favorable market conditions. The company's lawyers filed a document in a Texas Bankruptcy Court on May 22, stating that Core Scientific's liquidity position has significantly improved since the bankruptcy filing. Consequently, the firm plans to submit a reorganization plan in the near future.
The restructuring plan is currently being negotiated with key stakeholders, with Core Scientific actively seeking consensus on the future outlook of the company after it exits bankruptcy proceedings. A Chapter 11 bankruptcy allows the firm to continue operations while stakeholders work toward an agreeable restructuring plan. This plan may involve measures such as downsizing business operations to reduce debt or liquidating assets to repay creditors.
Core Scientific attributes its improved liquidity position to several market factors. Decreasing power costs, increasing Bitcoin prices, and a rise in the blockchain's hashrate have contributed to the boost in liquidity. Since Core Scientific's bankruptcy filing on December 21, 2022, the price of Bitcoin has surged over 60%, reaching approximately $27,000 from $16,904. Additionally, power prices have decreased by 24%, while the network hashrate has increased by 54%, as stated in the filing.
Despite delays in the bankruptcy proceedings, Core Scientific expects to have an additional $46 million in funds once the restructuring plan is finalized, thanks to the more favorable market conditions. The miner is also anticipating a substantial windfall from Celsius Network, as it claims the bankrupt crypto lender owes them approximately $11 million. The two companies are currently engaged in a court battle that originated in October 2022 when Core Scientific accused Celsius of failing to pay its power bills.