Riot Platforms has filed a lawsuit targeting Texas-based Bitcoin miner Rhodium Enterprises in order to reclaim “more than $26 million” in reportedly overdue mining facility charges.
Riot Mined 2,115 BTC in Q1 2023
On the other hand, the analysis also showed that Riot mined “2,115 Bitcoins” in Q1 2023, a 50.5% rise over Q1 2022.
Rhodium Broke Contract
Rhodium reportedly broke the terms of its agreement with Riot by neglecting to pay maintenance and service expenses related with using Whinstone’s Bitcoin mining facilities, a 100% subsidiary of Riot, based on Riot Platform’s Q1 2023 financial statement issued on May 10.
On May 2, a complaint was submitted in Texas’ Milam County Court against Rhodium Enterprises, seeking to collect “more than $26 million” and reimbursement of all legal bills paid.
Cancellation of Hosting Agreements
Furthermore, Riot asked permission to cancel “certain hosting agreements” with Rhodium and proposed not returning any remaining power credits after termination. It states:
“Because this litigation is still at this early stage, we cannot reasonably estimate the likelihood of an unfavorable outcome or the magnitude of such an outcome, if any.”
Riot has no Ties to US Bank Failures
It was also stated that Riot has no ties to any of the previous bank failures.
“We did not have any banking relationships with Silicon Valley Bank, Silvergate Bank, or First Republic Bank, and currently hold our cash and cash equivalents at multiple banking institutions,” stated the mining company.
Public Bitcoin (BTC) mining companies found it especially tough since they were stuck with a $4 billion debt as an outcome of taking out significant loans amid a strong 2021 market rather than a dismal 2022 market.
Furthermore, according to a February update on BTC.com, the most recent market adjustment has increased the mining difficulty for Bitcoin by 9.95%.
Moreover, Bitmain, one of the leading manufacturers of mining machines, allegedly violated Chinese tax regulations, for which the local government reportedly imposed significant fines.
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