Core Scientific Opposes $4.7 Million Compensation For Celsius

Key Points:

• Core Scientific has filed a denial of a $4.7 million Celsius Network claim.
• The rebuttal action taken by the crypto miner is that Celsius cannot prove that it has the right to claim it.
• With each passing day, Celsius is now said to owe Core about $11 million, an extra $28,000 in fees and interest.

Bankruptcy bitcoin miner Core Scientific has protested the payment of $4.7 million in executive compensation filed by crypto lending platform Celsius Network, leading to a battle between the two companies over contractual obligations.

According to an objection filed in Texas bankruptcy court on May 5, Core Scientific asked to dismiss Celsius Network’s $4.7 million administrative claim because Celsius could not prove it had such rights.

“Celsius request for allowance and immediate payment of the Celsius meaningful claim ignores that Core has substantial claims against Celsius, which Core exceeds the meaningful Celsius admin claim,”

The objection wrote.

Reportedly, Core Scientific signed a contract with Celsius in 2020 to store its crypto assets in Core’s data center. However, Core has moved these additional costs to Celsius due to higher electricity prices, which were supposed to be an allowance specified in the original contract.

Both companies are going through Chapter 11 bankruptcy: Celsius Mining filed on July 13, 2022, along with parent company Celsius Network, while Core filed on December 21. The two companies have engaged in ongoing litigation over their contracts. Core claims that Celsius does not pay the fee, while Celsius argues that Core unilaterally increased the power rate, which is not specified in their service agreement.

The cryptocurrency mining company has stated in its dissenting opinion that although Celsius initially paid these fees, it stopped paying after it filed for bankruptcy. In addition, Celsius now owes their company about $11 million, which adds up to $28,000 per day in fees and interest.

On December 28, 2022, Core Scientific asked the Southern District of Texas bankruptcy court to reject Celsius Mining’s contracts as an emergency measure, in which the hosting company claimed that it was losing approximately $2 million in incremental revenue each month. On January 3, Celsius agreed to let the crypto miner shut down the more than 37,000 Bitcoin mining rigs the miner was storing to crypto lenders.

DISCLAIMER: The information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your research before investing.

Join us to keep track of news: https://linktr.ee/coincu

Foxy

Coincu News