Core Scientific sold a Cedarvale, Texas-based mining location to bankrupt crypto lender Celsius for $14 million, while also releasing $31 million worth of claims against the company.
According to a court filing, Core Scientific jettisoned the mining location in Ward County, Texas. The deal with Celsius came to light in a Thursday court filing, which also revealed that Core Scientific is releasing its $31 million worth of claims against Celsius, elevating the overall transaction to $45 million.
Celsius Network and Core Scientific settlement. In exchange, Core will sell the Cedarvale site to Celsius and release all of Core’s own claims against Celsius. https://t.co/NN2Zs4WYBa pic.twitter.com/o5MCD3rdVA
— Ang 💕🌈💕🌈💕 (@Ang_0ne) September 15, 2023
Celsius court filing
The court filing stated, “After months of negotiations, Celsius and [Core Scientific] have now consensually resolved their long-running disputes and agreed to a global settlement that will fully resolve this litigation.”
Both companies are in the midst of financial challenges, with Core Scientific itself going through bankruptcy procedures. The settlement is pending court approval before it can be officially enacted. While this agreement appears to be a financial lifeline for both parties, it is also a strategic move aimed at restructuring and reinventing their businesses.
According to the documents, the mining site that Celsius acquired will serve as “a key component of Celsius’ reorganized mining business under its Plan.”
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The site is a “partially-developed, non-operational” mining facility boasting 215 megawatts of available power. Core Scientific is also transferring the site’s design plans to Celsius, thereby equipping the latter to complete construction.
In terms of historical context, Core Scientific had previously hosted 37,000 of Celsius Mining’s Bitcoin(BTC) rigs. Issues started cropping up when the parent company, Celsius, plunged into bankruptcy in July 2022, leading to Celsius Mining defaulting on fee payments and power bills.
Core Scientific ended its hosting agreement with Celsius in January 2023, essentially concluding what had been a financially turbulent relationship between the two entities.
Core Scientific CEO Adam Sullivan expressed his satisfaction at the resolution, stating he was pleased to resolve “all existing litigation” with Celsius Mining. He also mentioned that Core Scientific aims to emerge from its restructuring process later this year.
This recent agreement not only offers an immediate financial solution for the involved parties but also provides a blueprint for their respective futures in an increasingly competitive and evolving crypto mining industry.
Read more: Former Celsius CEO arrested in New York, SEC files lawsuit