Bitcoin mining company CoinTerra has filed for Chapter 7 bankruptcy with the United States Bankruptcy Court for the Western District of Texas, Austin Division.
The company had reportedly been defaulting on its payouts to holders of mining contracts, and was recently sued by a data center provider for $5.4 million.
The company's website now just shows a screenshot of text briefly describing the announcement, and refers visitors to the bankruptcy court's website.
The filing document indicates that the company possesses between $10 million and $50 million in assets, its liabilities falling in the same range. The total shortfall has yet to be disclosed.
Chapter 7 is the most common type of bankruptcy in the United States. The business would have to cease operations unless transferred to a Chapter 7 Trustee, who would usually liquidate the company's assets. Occasionally, functioning parts can be sold off intact to other companies. CoinTerra's filing indicates that after secured creditors have been paid, it is estimated that no funds will be available for unsecured creditors.
CoinTerra becomes the latest casualty in a string of incidents affecting the mining industry. HashFast filed for Chapter 11 bankruptcy last year and reportedly owes $40 million.
HashFast's collapse was seemingly a result of failed Execution . Bitcoin prices, which were much higher at the time, are unlikely to have been the main cause, although they may have exasperated the situation. The causes for CoinTerra's fall are also unclear, though its struggles did transpire over a period of significantly weaker prices.
The struggles of other mining businesses such as Ghash.io were reported as price-related.
