This crypto company has lost $1.7 billion in 2022.

This crypto company has lost $1.7 billion in 2022.
This crypto company has lost $1.7 billion in 2022.

The largest publicly traded Bitcoin mining company in the US, Core Scientific Inc. reported a loss of $1.7 billion for the first nine months of 2022. The Texas-based company is one of the hardest hit in the sector as low Bitcoin prices have caused mining revenues to drop to historic lows.

One of the reasons is the low price of the flagship cryptocurrency, due to which mining revenues have fallen to an all-time low. Profit margins also fell as a result of rising electricity prices, the difficulty of mining and increased competition in the industry.

In the third quarter, the company suffered a loss of about $434 million. In October, Core Scientific warned that it may have to file for bankruptcy if it fails to raise more capital to pay off more than $1 billion in debt.

At the beginning of the year, the company owned about 8,000 BTC. In the second quarter, it sold off about 7,200 of its Bitcoin token holdings as the asset’s price fell by more than 60%. Additionally, the company’s stock value has fallen over 97% this year to just $0.16.

According to the report the company for the third quarter, some of its customers filed lawsuits against it, accusing it of not making or returning payments.

READ MORE: Top 3 Risk Factors in the Crypto Space

Also Core Scientific missed several payments on its debt in October as it expects its financial reserves to run out by the end of 2022 or sooner. If this happens, the company can most likely turn to the relevant bankruptcy procedures. Considering its size, if it goes bankrupt it could have a significant effect on the cryptomining industry.

The company contributes over 10% of the computing power required to secure the entire Bitcoin network. More than 40% of its over 240,000 servers are part of hosting agreements. Through them, Core Scientific offers its customers, including other significant miners (who do not have their own hosting sites), data center space and related mining equipment management services.


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