Core Scientific To Switch Off Celsius’ Miners, Freeing Space for Other Clients

Celsius owes the Texas-based miner some $7.8 million for power costs

article-image

Source: Shutterstock / Mark Agnor, modified by Blockworks

share

Cryptocurrency miner Core Scientific said it can’t continue to bear the daily loss of keeping Celsius as a client, and so it’s ending a hosting agreement with the crypto lender. 

The miner told a US bankruptcy court on Tuesday that it will power down more than 37,000 Celsius rigs spread across its facilities on Jan. 3. All rigs will be transported to Celsius at the bankrupt lender’s own cost before March 18. 

Core Scientific is associated with hosted mining, allowing third parties to pay a fee for rigs they purchase depending on their power usage. 

The parties had an arrangement where Celsius would pay for its own power costs, but the company refused to pay some $7.8 million owed through Nov. 31, Core’s lawyers said in court papers.

Core Scientific hosts mining machines for about 15 customers, while operating their own machines as well. Demand for hosting far exceeds Core’s capacity, meaning that the miner was waiting to free up some of its rack space for other clients. 

Core provided hosting space to 41% of its total fleet (or 100,000 servers) as of Oct. 31, according to a company update.

Soaring electricity costs have caused a huge nuisance for crypto miners, squeezing their profit margins, as a combination of extreme weather conditions and Russia’s Ukrainian invasion have driven up prices. 

Core itself filed for bankruptcy in December, partly blaming Celsius’ non-payments for its own liquidity woes. 

Lawyers argue that terminating the Celsius contracts could generate about $2 million in revenue per month, as the same hosting space would be used for other, more willing customers.

Core further established that continuing the Celsius contracts would mean losing money every day, putting the monthly figure at nearly $895,000 in December. 

If the miner decides to use the space for its own operations, that could generate 400 bitcoin per month at an assumed price of $16,700, producing $2 million in revenue, according to its own estimates.


Get the news in your inbox. Explore Blockworks newsletters:

Tags

Decoding crypto and the markets. Daily, with Byron Gilliam.

Upcoming Events

Old Billingsgate

Mon - Wed, October 13 - 15, 2025

Blockworks’ Digital Asset Summit (DAS) will feature conversations between the builders, allocators, and legislators who will shape the trajectory of the digital asset ecosystem in the US and abroad.

recent research

Research Report Templates.jpg

Research

Figure, founded by former SoFi CEO Mike Cagney, has emerged as a leader in onchain RWAs, with ~$17.5B publicly tokenized. The platform’s ecosystem volume is growing ~40% YoY as it expands beyond HELOCs into student loans, DSCR loans, unsecured loans, bankruptcy claims, and more. Operationally, Figure cuts average loan production cost by ~93% and compresses median funding time from ~42 days to ~10, creating a durable speed-and-cost advantage.

article-image

In bonds, stablecoins and billionaires, a reminder of what makes crypto special

article-image

21Shares exec says CPI and PPI data supports a Fed rate cut, with market leaning toward a 25bps decrease

article-image

The Ethereum co-founder suggested LINEA holders would be eligible for other airdrops in cryptic tweet

article-image

The layer-2’s biggest release yet brings benefits — but a post-upgrade outage caused a chain reorg

article-image

Crypto is shifting into risk-on mode — pump.fun dominates meme activity, while Lido leans on treasury maneuvers

article-image

If the president breaks the Fed, he’ll own the budget problems