Thursday, September 28, 2023

Celsius and Core Scientific propose a $14 million settlement in their litigation

Cryptocurrency mining company Core Scientific has announced an agreement with lending firm Celsius Network to resolve a legal dispute that had dragged on for months.

In a Sept. 15 announcement Core Scientific said it agreed to sell a Bitcoin (BTC) mining data center to Celsius in exchange for $14 million in cash to resolve “all existing litigation.” The Texas-based data center was valued at about $45 million, and the deal requires court approval before closing.

The conflict between the two companies largely began in October 2022, when Core Scientific claimed that Celsius had not paid its invoices, while Celsius claimed that the mining company had not used drilling rigs as required by its contract.. Both companies separately filed for Chapter 11 bankruptcy protection in the United States: Core Scientific in Texas in December 2022 and Celsius in New York in July 2022.

The Texas data center, which is likely to be taken over by Celsius’ mining division if the deal is approved, was not operational but was able to deliver 215 megawatts to BTC platforms. According to the CEO of Celsius, Chris Ferrero, a US-based Bitcoin cryptocurrency mining company, played a “key supporting role in structuring and executing the transaction” and was part of a successful bid for Celsius assets in bankruptcy proceedings.

The litigation between the two companies is separate from the criminal charges against former Celsius CEO Mashinsky and former Chief Revenue Officer Roni Cohen-Pavon. Mashinsky was arrested in July and pleaded not guilty to charges of fraud and market manipulation. Cohen-Pavon pleaded guilty to four counts on September 13 and will be sentenced in December.

Clarification: The information and/or opinions expressed in this article do not necessarily reflect the views or editorial policy of Cointelegraph. The information presented here should not be construed as financial advice or investment recommendations. All investments and commercial movements involve risks and it is each individual’s responsibility to conduct careful research before making any investment decision.

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Nation World News Desk
Nation World News Desk
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