Generate Capital to Purchase Bankrupt Compute North’s Assets in 2 Mining Sites

According to bankruptcy filings on Tuesday, lending firm Generate Capital is purchasing Bitcoin mining hosting firm Compute North’s stake in two mega-mining facilities (a 300-megawatt (MW) facility in Wolf Hollow, Texas, and a 100 MW one in Kearny, Nebraska) for $5 million.

A U.S. Bankruptcy judge in the Southern District of Texas signed the order approving the sale of Compute North’s stake in the two mining facilities.

According to the purchase agreement, Generate Capital was the only bidder for Compute North’s equity, and the court approved the sale on Tuesday.

As part of the sale, Generate Capital is fully purchasing Compute North’s sites for $5 million and will assume the liabilities as well as obligations to clients that host their machines at the sites.

In late September, Compute North became the latest casualty of the bear market and filed for Chapter 11 bankruptcy, saying it can’t fulfil debt obligations worth up to $500 million.

In its bankruptcy filing, Compute North blamed its financial woes on this year’s bear market, the rising cost of electricity in the U.S. and the time it takes between constructing two new data centres and becoming profitable.

The biggest blow came from a loan that the Bitcoin miner secured from Generate Capital. In February, Generate Capital lent Compute North $300 million to finance the development of the two sites in Texas and Nebraska.

While Compute North was able to repay some of the funds, about a third of it was still outstanding as it defaulted payments.

In July, in bids to recover its money, Generate Capital took over some of Compute North’s assets, including two of the sites that its finance had gone towards construction purposes.

Generate Capital’s move to take control of Compute North assets triggered the Bitcoin miner’s chapter 11 bankruptcy in late September.

The Chapter 11 bankruptcy filing protected the Bitcoin miner from its creditors while allowing it to continue operations. This has given it enough breathing space to figure out a way to repay its creditors without having to be auctioned off.

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Crypto Miner Merkle Increases Hash Rate 9x to 3.1EH/s in 8 Months

Bitcoin miner Merkle Standard has formed a joint venture with Bitmain, one of the world’s largest Bitcoin mining equipment manufacturers, to increase its total computing power, or hash rate, from about 0.3 EH/s to 3.1 exahash ( EH/s). With the partnership, the computing power is increased by 900%.

Merkle revealed that it has added 40 megawatts (MW) of mining capacity to its South Carolina facility, bringing its total mining capacity to 140 MW.

The company said that the machines that will be used are Bitmain’s latest mining rigs, the S19 XP Mining Bitcoin (BTC), or S19J Pro models, which are among the most energy-efficient bitcoin mining machines on the market.

The site has exclusive rights to an additional 50 megawatts of electricity, allowing the site to expand to 86 megawatts

The site, Merkle’s main mine in eastern Washington, currently has 100MW of online power generation and is expected to reach 225MW by the end of 2023, with a maximum expansion capacity of 500MW.

The Blue Ridge base in South Carolina is Merkle’s second facility, which the company said it expects to expand to 80MW of mining capacity by the end of 2024.

January 21, 2022: Merkle Standard, a sustainable digital asset mining platform, announced a purchase order for new mining machines from Bitmain Technologies Ltd. The executed purchase agreement is for 13,500 mining rigs from a leading ASIC mining manufacturer.

As Bitcoin’s value plummeted 45 percent in June, many mining companies have gone to great lengths to adjust their operations; some are buying mining equipment, others are suspending mine construction, and still, others are expanding projects.

In June, Bitfarms sold 1,500 bitcoins for about $62 million and used the proceeds to reduce debt.

In July, CleanSpark continued to expand its infrastructure by acquiring 1,061 Whatsminer M30S rigs at a deep discount.

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Maple Finance Provides $300m In Loans to Bitcoin Miners Struggling amid Market Crash

Maple Finance, Australia-based Decentralized finance (DeFi) firm for institutions to borrow from Liquidity Pools funded by the DeFi ecosystem, announced on Tuesday that it has launched a $300 million fund for Bitcoin miners.

The lender established the move as the cryptocurrency mining industry struggles with access to capital markets. Raising capital has become difficult for crypto mining companies this year as Bitcoin price has drastically declined and energy prices have skyrocketed. Maple is looking to fill the gap.

In a statement, Sidney Powell, the CEO and co-founder of Maple, said: “Recent market headwinds have caused lenders to pull back, while traditional financing vehicles have been slower to engage this sector. Miners play an essential role in growing the crypto ecosystem and local economies, and we are proud to extend a new financing vehicle to direct capital where it is needed the most.”

Maple said that the $300 million lending pool will provide 12 to 18 months loans with interest rates ranging from 15% to 20% to blue-chip Bitcoin mining and digital asset infrastructure firms in North America, Canada, and Australia.

The $300 million lending pool is targeting to lend out funds to blue chip private and public firms with “effective treasury management and prudent power strategies,” Maple said. The pool will only offer fully collateralized loans, either by digital assets or real-world assets, including mining hardware, power transformers, and other physical assets.

Maple plans to open more lending pools for the growing mining sector and expects to expand its lending services to fintech firms.

When Will Miners Recover from Crash?

Many Bitcoin mining firms that expanded operations last year to capture more profits are now struggling as the crypto’s prices plunged.

The recent market crash has left miners going through a painful situation. Mining Bitcoin has become less profitable as the price of the cryptocurrency has nosedived, with popular machines like Bitmain’s Antminer S9 becoming money losers amid increased electricity costs.

Many miners have been cornered into powering off their operations or selling their holdings, while some are struggling to repay billions of loans that are backed by their equipment.

Struggling miners who preferred not to shut down their rigs were approved to raise capital in the debt or equity markets and/or sell off Bitcoin holdings.

In July, several miners, such as Argo Blockchain, Bitfarms, Core Scientific, and Riot Blockchain, among others, sold part of their Bitcoin holdings to secure funds designed to sustain their operations.

Last month, Bitcoin mining hosting firm Applied Blockchain secured a $15 million loan to pay off its existing debt and fund the construction of its data centres.

The crypto market recently went through an extreme crash in May and still has not come out of it. Major cryptocurrencies went through price drops, with Bitcoin plunging its price by more than half.

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Another solo Bitcoin miner solves valid block, making it fourth in 2022

Hopium is back on the menu for solo Bitcoin (BTC) miners. A circa $240,000 reward, or 6.25 BTC, was generated by yet another solo miner this morning. 

This time, the odds were less than 20%, according to Con Kolivas, a Bitcoin software engineer and administrator for ckpool, whose name takes his initials. It’s the fourth “blockfind” for the ckpool since Jan. 11. 

Kolivas tweeted his congratulations to the miner who joins the ranks of the few and fortunate successful solo BTC miners.

The plucky miner belongs to the Solo ckpool, the service that offers anonymous solo Bitcoin mining with a fee. At 1.14 petahashes per second (PH/s), the miner is considered a ‘whale’ miner, with a considerable hash rate for one single entity.

A new BTC block is solved roughly every 10 minutes by miners competing against the entire bitcoin network hashrate. By way of comparison, United States Bitcoin miners Foundry are currently the largest contributors to the network hash rate, with 33,803 PH/s.

One Twitter user estimated that while 1.14PH/s is a lot, it is still less than a room full of S19s, the flagship mining product by Antminer.

Related: Bitcoin miners believe global hash rate to grow ‘aggressively’

The ckpool has taken the mining world by storm recently. A Bitcoin miner with a tiny hash rate of just 126 terahashes per second (TH/s)–possibly a single S19 machine–solved a valid block on January 12th. Two weeks later, another underdog with a mere 86 TH/s achieved the improbable by solving another valid block.

Over the course of the Bitcoin blockchain’s existence, 264 blocks or 0.037% of the circa 721,240 blocks were solved by ck’s solo Bitcoin miners. While the odds are clearly against the soloists, they continue to surprise and delight Bitcoiners.