- BlockFi Bitcoin mining loans will be backed by 68,000 mining machines.
- Some of these loans are under-secured due to falling mining rig prices.
- Earlier this month, Celsius Mining also filed with the court the sale of its $1.3 million worth of mining equipment.
BlockFi took a major hit last year after the collapse of FTX in November and Three Arrows Capital in the second quarter of 2022. Filing for bankruptcy just after FTX, BlockFi launched a list of companies that went bankrupt shortly afterwards and who are still trying to recover their clients’ funds. . BlockFi itself seeks to achieve the same goal.
BlockFi Bitcoin Mining Loans
BlockFi is currently looking to sell Bitcoin mine machine-backed loans to users using its 68,000 platforms. The loans, which amount to $160 million, are expected to be undersecured due to falling prices for mining machinery.
On average, at this time last year, mining rigs under 38 J/Th were worth around $98, which have since lost their value by almost 90% and are currently worth around $9.9. The reasons behind this range from the collapse of the crypto market and the drop in the price of BTC as well as the increase in operating costs, including energy costs.
Bitcoin ASIC Miner Price
The drowning mining market was funded by BlockFi, although traditional lenders kept a distance due to the high level volatility of the crypto market.
Other financiers included the New York Digital Investment Group, digital currency Group’s Foundry, Galaxy Digital and bankrupt lender Celsius Network.
Celsius Mining sells its miners
Unlike BlockFi which sells loans secured by Bitcoin mining machines, crypto lender Celsius Network would sell its mining equipment. Filing in bankruptcy court on January 13, the bankrupt company’s mining arm said it was looking to sell about 2,687 bitcoin miner rigs to an investment firm called Touzi Capital.
Earlier this month, the founder and CEO of the bankrupt loan company, Alex Mashinsky, was sued by New York Attorney General Letitia James.
According to James, Alex was responsible for defrauding hundreds of thousands of customers and sought to prevent him from doing business in New York again, while recovering the losses suffered by investors.