Breaking: Celsius Network Bankruptcy Spurs New Bitcoin Mining Operation by Hut 8
In a significant move within the cryptocurrency sector, Hut 8, a prominent Canadian Bitcoin mining firm, has announced an interim agreement to establish a new mining site in Cedarvale, Texas. This development emerged in the wake of the Celsius Network bankruptcy proceedings, marking a strategic pivot for both entities involved.
Hut 8 Expands Operations Amidst Crypto Turbulence
The new site in Cedarvale is set to become a major hub for Bitcoin mining, with Hut 8 planning to deploy approximately 66,000 miners, powered by over 215 megawatts of energy. This expansion underscores the firm’s commitment to growth despite recent market volatility. Asher Genoot, President of Hut 8, highlighted the dual objectives of this venture, to build equity with Celsius’s creditors and to bolster their managed services business. The anticipated addition of this site will bring Hut 8’s total infrastructure to over 895 MW, marking a significant milestone in its operational capacity.
Construction of the Cedarvale site is slated to begin shortly, with Hut 8 overseeing a comprehensive range of services including design, engineering, financial modelling, and construction management. This full-spectrum approach demonstrates Hut 8’s expertise and readiness to handle large-scale mining operations.
Celsius Network’s Ongoing Restructuring
Celsius Network’s involvement in this project is critical to its restructuring plan following its 2022 collapse and subsequent bankruptcy declaration in July. The former CEO, Alex Mashinsky, faced legal challenges, including arrests on multiple fraud charges, contributing to the company’s destabilization.
This partnership with Hut 8 comes after Celsius received bankruptcy court approval to transform into a creditor-owned Bitcoin mining firm. This restructuring is part of a broader strategy to repay customers and stabilize the company. As part of the post-bankruptcy plan, Celsius’s mining operations were to be managed by US Bitcoin Corp (USBTC), which merged with Hut 8 in November 2023. This merger followed a previous agreement in August 2023, where USBTC agreed to host 8,500 miners for Celsius at its Alpha Site.
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