Bitmain, a cryptocurrency mining hardware manufacturer, has entered into a deal with Core Scientific, a bankrupt crypto mining company, which combines equity and cash to expand their mining facilities.
In this agreement, Bitmain will provide 27,000 Bitcoin mining rigs, with a price tag of $23 million in cash and an additional $53.9 million worth of common stock from Core Scientific. Besides the mining hardware acquisition, both companies have also established a new hosting arrangement aimed at supporting Bitmain’s mining operations.
This deal was officially sealed in August, with Anchorage also participating by acquiring an equity stake in the struggling crypto miner.
The finalized expansion and investment plan orchestrated by Bitmain is scheduled to take effect in the fourth quarter of this year, pending approval from a judge, which is expected during the same period. Upon approval, this additional mining hardware is projected to contribute 4.1 exahashes to Core Scientific’s hash rate. Furthermore, the two crypto mining-focused firms have committed to collaborating on upgrading Bitmain’s previous-generation miners located within Core Scientific’s data centers, enhancing overall productivity.
Core Scientific had filed for Chapter 11 bankruptcy in December 2022, citing financial difficulties and the declining value of Bitcoin as the primary factors behind their decision. In the lead-up to its collapse, the firm encountered mounting challenges due to the turbulent cryptocurrency market.