When people are still sighing,bitcoinMining company Core Scientific (CORZ-US) became the latest crypto industry company to file for bankruptcy, investors hardly guessed, but the company’s stock price soared a record 273% intraday and closed up 73% the next day.
The situation is akin to Revlon Inc.’s surge following it filed for bankruptcy when it was rumored that it had funds ready to buy the company.
cryptocurrencyMatthew Kimmell, a digital asset analyst at investment firm CoinShares, said it may be that following seeing the list of creditors and the assets on hand, investors gained some confidence and bet on a positive future for the company. This is not the case with FTX, which is heavily weighted in liability classes versus assets.
Core Scientific, headquartered in Austin, Texas, is the largest computing powerbitcoinMiner, and the first major public mining company to declare bankruptcy.bitcoinMiners raised billions in debt financing during the last bull market, but due tobitcoinThey have been struggling to pay their debts amid depressed prices and rising electricity costs.
Core Scientific’s bankruptcy filing shows it has $1.4 billion in assets and regarding $1.3 billion in liabilities, making the miner different from most bankrupt crypto companies.
Meanwhile, U.S. authorities are launching a massive investigation into the collapse last month of FTX, once one of the world’s two largestcryptocurrencyexchange.
Core Scientific was approved for a $37.5 million loan on Thursday (22nd) to help it deal with bankruptcy.this homebitcoinThe mining company is working on a plan to restructure its debt, which would wipe out nearly all existing shareholders.
About 544 million Core Scientific shares changed hands on Thursday, nearly 3,000% above the daily average over the past three months. But unlike Hertz Global Holdings and Revlon, retail investors appear to be shunning the frenzy.
Even with Thursday’s sudden rebound, Core Scientific remains one of the worst-performing U.S. stocks in 2022. After trading at regarding $11 a share at the start of the year, the company’s shares have plunged nearly 99% so far this year, trading as low as 5 cents following declaring bankruptcy on Wednesday.