Bitcoin miner Rhodium Enterprises has filed for bankruptcy in the Southern District of Texas. The firm cited debts of $50 million to $100 million, with assets ranging from $100 million to $500 million.
The filing includes six subsidiaries: Rhodium Encore, Jordan HPC, Rhodium JV, Rhodium 2.0, Rhodium 10MW, and Rhodium 30MW.
Declining profits for Bitcoin miners, due to the last halving and higher electricity prices, have exacerbated Rhodium’s financial struggles.
In July, Rhodium Enterprises failed to repay loans worth $54 million. Despite raising $78 million in 2021, disagreements on debt restructuring led to default.
How crypto companies file for Chapter 11
The collapse of the Terra ecosystem triggered a wave of bankruptcies, including Celsius Network, Three Arrows Capital, Voyager Digital, and FTX.
Many of these firms, like Core Scientific, used Chapter 11 in the U.S. Bankruptcy Code to reorganize their finances and continue operations.
The worst time to mine Bitcoin
Bitcoin mining has struggled post-April halving. BlocksBridge Consulting indicated mining costs exceeded $60,000 per coin for companies like MARA, Core Scientific, and Riot in recent months.
Hashrate recovery remains low, even after Bitcoin prices rebounded. Rising electricity costs continue to challenge profitability.
Experts believe that larger miners are shifting to more energy-efficient equipment. CryptoQuant expects Bitcoin’s value to rise to $70,000 by year-end.
Mining centralization
Rhodium’s bankruptcy supports CryptoQuant’s prediction of smaller miners exiting the market.
BTC.com data reveals two mining pools, Foundry USA and AntPool, now control over 50% of Bitcoin’s current hashrate.
