Bitcoin’s new year rally is resuscitating many crypto-mining companies seeking to escape from near financial ruin after one of the most devastating quarters ever for the nascent industry. Whether they succeed in making a comeback remains in question.
High electricity costs, a plunge in digital assets prices and persistent network competition in the fourth quarter slashed mining profit margins and made it difficult for miners to stay afloat. Core Scientific Inc., the largest public Bitcoin mining company by computing power, went bankrupt and multiple major miners warned of liquidity crunches. While struggling miners have garnered some relief from Bitcoin’s 40% rebound this year, they are still under financial pressure.
