Bitcoin mining firm Core Scientific filed its bankruptcy protection plan, which has been filed in the bankruptcy court of the Houston Division of the Southern District of Texas in the United States.
Core Scientific said it has boosted its liquidity since filing for bankruptcy protection and is focused on revamping its business plan for a successful comeback.
Chapter 11 bankruptcy allows a company to continue operating until stakeholders can agree on a restructuring plan, which could involve steps such as downsizing the business to reduce debt or liquidating assets to repay creditors. A Chapter 11 bankruptcy plan is a formal document outlining how a company intends to reorganize and repay creditors.
Core Scientific has received permission from the Bankruptcy Court of the Southern District of Texas to secure a loan of up to $70 million from investment bank B. Riley, one of the company’s largest creditors. The loan will be used to repay the bankrupt bitcoin miner’s existing debtor-in-possession financing loan, also from B. Riley.