Bitcoin Forum

There is a news that one of the largest Bitcoin mining firm is shutting down Bitcoin mining machines that are generating almost 2 million dollars. That is because Celcius is shutting down and that's not good. Because if they continue mining than they can go in loss.
I do not know that this this there big move or not but I will say that they are just doing great.
Here is link of an article.
Source: https://markets.businessinsider.com/news/currencies/core-scientific-shut-down-thousands-bankrupt-celsius-bitcoin-mining-rigs-2023-1

Celcius stopped paying core scientific so core scientific is shutting down their miners. No different then any other hosting company shutting down equipment that they are not getting paid to host. It's not a lot in the grand scheme of things in terms of BTC mining. If the $2 million cost per month is accurate then it's good for them since they were obviously never going to get paid.

I'm surprised it took them this long, although they might have had to follow their contract about keeping them on until payments were a certain number of days late.

-Dave

Read up the news and I want to ask, what is the implications of their actions to the entire crypto space.
Will the shutting impact crypto negatively or has no direct impact whatever.

I would like to know, and will be thankful if anyone cares to shed more light.

There will be adjustment to the mining difficulty and will be adjusted most probably by 16th and we have a hash rate of  34 T which means there wont be any implications that would affect the market or BTCitcoin itself. The rest of the reason for shutting down the mining machines is explained in the article and DaveF explained them above as well.

I think news like this makes some people want to get into mining - if the news is spread far enough.

Some people notice gaps in the market and either don't bother to measure feasibility or try to measure it by buying a machine (and if a few hundred people do that as a result, bitcoin is arguably slightly more decentralised).

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I wonder whatll happen to those miners that are being shut off? Is it profitible to buy miners now and sell them nearer the halving? Would a production company want to buy then to make sure their prices don't fall further?

Usually before such things happen in a bankruptcy, the court will try to sell off all valuable assets. Since this did not happen means that there was nobody willing to buy this part of the business. So we can assume this business was loosing money anyway and this could only the beginning of difficulty collapsing.

It's a managed mining services for a bankrupt company that are getting shut down. Celcius has already filed for bankruptcy so they are unable to pay the maintenance fees for the miners which were being managed by Core Scientific. So the decision is fair!

I don't think there will be any issue in the crypto ecosystem due to this decision of Core Scientific. If they find any other company willing to buy their managed mining services, they might turn them on again!

It’s not big deal. It’s just one company getting out of the business because due to few collapsed conditions of the market and their dropped revenue. For any business that is last resort if they fail to achieve given goals and pay offs. They have taken good decision because keeping the mining farm alive without any income is like burning energy and resources to achieve nothing in return.
In addition to this, it won’t be affecting bitcoin or its price or anything else. Only other miners will get benefited because there is one competition less in the market. :)

reading previous news CORZ was charging its customers $0.10c/kwh electric(higher than previous months, and higher than national average electric costs) which put the costs at more then the market rate of bitcoin (unprofitable mining)

thus many customers can rightfully so. stop paying ongoing hosting contracts, and retrieve their asics via corz sending the customers asics back to the customer or forward the asics to another hosting business.

celsius was already debating with CORZ about this
https://cointelegraph.com/news/celsius-network-defaults-on-payments-to-core-scientific-causing-financial-unrest

massive cost change
us national rates went from a average
$0.0744 ->$0.0861 (oct 21-oct22)
yes corz charged a
$0.0752 -> $0.0943 (2021-july 2022)
then asked for over $0.10 from august onwards

basically $0.014 extra than national average (16%)
the initial 2021 ask by coz was a 0.0752 ask which was 1.1% above average

in short corz was trying to demand an extra 15% profit for corz, while supplying celsius with less coin value thus not break even or profit compared to market rate

(celsius losing value by continuing contract but corz making excess profit by continuing contract)

anyways
there is alot more to this celsius-corz saga where it appears that corz is being shady in parts too

It seems like a business decision, if mining bitcoin stops being profitable, then they would stop mining and instead they would use the ones they have to sell and make a profit for a while longer. Not like they were making a profit and selling every single bitcoin they had when they mined, they were probably just selling the costs, and keeping some of the profits in bitcoin.

This way they could stop now, have very low cost (operational) and they could sell the ones they saved until bitcoin is profitable again to mine. This would be a smart way to approach for sure, not a great way but a smart way. I think they will go with that route very soon.