The collapse of TerraUSD in May led to decentralized finance (DeFi) platform Celsius freezing withdrawals, swaps, and transfers between customer accounts due to the “extreme market conditions.” The company filed for bankruptcy last week, leaving its users concerned about when, or if, they’ll get their money back.
A lot cheaper than they used to be Bloomberg reports that Celsius’ mining subsidiary also filed for protection. Celsius Mining’s filing revealed it owns 80,850 rigs, 43,632 of which are in operation, and expects to run about 120,000 rigs and generate more than 10,000 coins by the end of this year. It’s expected that Celsius Mining will sell off some of its ASIC mining equipment. The problem, however, is that prices of these machines have fallen as much as 50% to a two-year low as the crypto winter continues. CoinDesk writes that Celsius Mining already auctioned off at least 7,000 of its newly purchased mining rigs in June for a less than market value. And with more mining companies going into liquidation, the trend is expected to continue. Celsius emphasizes that filing for Chapter 11 bankruptcy will allow it to reorganize its financial obligations while operations continue. The company is expected to carry on at least part of its mining business as a way to pay some of what it owes. Celsius has 100,000 creditors, which includes an $81 million unsecured claim from Cayman Islands-based Pharos Fund and a $12 million unsecured loan to Alameda Research. While Celsius Mining uses ASIC machines, we’re also seeing second-hand PC hardware prices fall as more graphics cards once used by amateur miners land on auction sites.
