Crypto mining firm Core Scientific is facing a turbulent trading session after relisting its shares following its emergence from bankruptcy. Robinhood data shows that Core’s stock, CORZ, has declined by over 30% at the time of writing, trading at $3.84.
After undergoing a 13-month restructuring process, the company relisted its shares on the Nasdaq on Jan. 24. In an announcement, Core said it now has a “strengthened balance sheet” after clearing out a $400 million debt.
Core's restructuring plan resulted in converting debt owed to equipment lenders and convertible note holders into equity in the company. Convertible notes are a type of debt that can be converted into stock, and by converting this debt into equity, Core Scientific reduces its financial liabilities.
“Price volatility is not a surprise,” a spokesperson from Core Scientific told Cointelegraph. “We remain focused on executing our pragmatic growth plan to deliver long-term shareholder value.”
The company is also considering turning its remaining debt into equity and using cash as part of the bankruptcy plan.
Core Scientific is among several crypto miners heavily impacted by the crypto winter. In December 2022, the company filed for bankruptcy under Chapter 11 due to falling Bitcoin (BTC) prices, rising energy prices, and debts tied to the also bankrupt Celsius Network. A Chapter 11 bankruptcy allows a firm to continue operating until stakeholders agree on a restructuring plan.
In 2023, the company produced 13,762 BTC from its own fleet of miners and another 5,512 BTC on behalf of its hosting customers. However, mining companies will face new challenges in 2024.
Asset manager CoinShares forecasts a rise in both production and cash costs for Bitcoin miners following the halving event. The anticipated costs are estimated to escalate from around $16,800 and $25,000 per Bitcoin to between $27,900 and $37,800. Additionally, the average cost of production for crypto miners post-halving is expected to reach $37,856.
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