While Celsius announced in July that it was concentrating some of its business in cryptocurrency mining as part of its restructuring, we learn that Celsius Mining, its mining arm, will sell 2,700 of its machines. The sale deal, which exceeds $1.3 million, was signed by investment firm Touzi Capital.
Celsius sells Bitcoin mining machines
The prospect of an exit door for Celsius appears to be fading. And for good reason, the mining arm of the bankrupt company will sell about 2,700 of its Bitcoin (BTC) mining machines, which amounts to over $1.3 million.
This is a surprising move given that Celsius announced in July that it was restructuring into BTC mining as part of its US Chapter 11 protection. However, the current environment is so unfavourable for cryptocurrency miners, especially due to the cost of energy, that Celsius was probably losing more money than it was making from this activity until now.
Excerpt from Celsius filing
According to the January 11 filing by Celsius in the US Bankruptcy Court for the Southern District of New York, Touzi Capital will acquire the mining machines. Touzi is a company that specialises in various fields, including real estate, but also invests in Bitcoin mining. It already has several mining farms in the United States.
According to the document, it was Touzi that managed to make the highest bid for the equipment. The company was chosen after Celsius spoke with “several brokers and market players”.
The financial situation of Celsius
According to the Celsius filing, the proceeds from this sale will be used for “general and corporate expenses. This is a rather vague explanation, which has led to legal opposition from Víctor Ubierna de las Heras, a creditor of Celsius, who has appealed to the relevant bankruptcy court:
” They say that the intended use of the proceeds of the sale is for “general and business expenses”. This is like saying nothing. Corporate and general expenses can mean everything and nothing at the same time. […] Will Celsius use the proceeds of the sale to pay off his creditors? Will Celsius pay his rent with the money? You can’t tell by reading the contents of the document. “
It’s a double whammy for Celsius, which was recently forced to shut down 37,000 of its mining machines that were leased from Core Scientific, as the company was no longer able to afford the cost of running them.
