July 16, 2024
Core Scientific resolves legal dispute with Celsius Network
Bitcoin News

Core Scientific and Celsius Network Resolve Legal Battle with $14 Million Data Center Deal

Crypto mining company Core Scientific has revealed a resolution to its ongoing legal dispute with lending firm Celsius Network, which has persisted for several months.

In an announcement made on September 15, Core Scientific disclosed that it had reached an agreement with Celsius Network. The terms of this agreement involve Core Scientific selling a Bitcoin mining data center to Celsius for $14 million in cash, effectively settling all existing litigation. The data center, based in Texas and originally valued at around $45 million, will require court approval before the deal is finalized.

The roots of the conflict between the two companies can be traced back to October 2022, when Core Scientific accused Celsius of failing to meet its financial obligations. In response, Celsius contended that Core Scientific had not fulfilled its obligations to deploy mining rigs as stipulated in its contract.

This dispute ultimately led both companies to file for Chapter 11 bankruptcy protection in the United States: Core Scientific filed in Texas in December 2022, while Celsius filed in New York in July 2022. The Texas-based data center, subject to approval, is expected to become part of Celsius’ mining operations, despite being reported as non-operational, with the capacity to provide 215 megawatts to BTC rigs.

Notably, Celsius CEO Chris Ferrero acknowledged the involvement of crypto mining company US Bitcoin, which played a pivotal role in structuring and executing the transaction. US Bitcoin also participated in a successful bid for Celsius’ assets during the bankruptcy proceedings.

It is essential to distinguish this legal settlement between the two companies from the ongoing criminal charges faced by former Celsius CEO Mashinsky and former Chief Revenue Officer Roni Cohen-Pavon. Mashinsky was arrested in July and has pleaded not guilty to charges related to fraud and market manipulation, while Cohen-Pavon pleaded guilty to four charges on September 13 and awaits sentencing in December.

Image by freepik

Disclosure Statement: Miami Crypto does not take any external funding, or support to bring crypto news to the readers. We do not have any conflicts of interest while writing news stories on Miami Crypto.

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