Bitcoin miner Rhodium Enterprises filed for Chapter 11 bankruptcy in the Southern District of Texas on Saturday.
Filed under the business name Rhodium Encore LLC, the bankruptcy includes five other affiliate entities under Rhodium’s corporate umbrella. The move comes on the heels of rumors that the miner has been facing solvency issues.
In an email sent to investors on Saturday, Rhodium management said that they are working to secure financing to help the company restructure its debt. Rhodium said that the restructuring will not disrupt its mining and hosting businesses.
“We are in the process of obtaining debtor-in-possession financing, which we believe will give us the capital we need to operate in, and emerge successfully from, chapter 11,” the email stated.
“While the Bankruptcy Code prohibits these subsidiaries from paying their creditors on account of their pre-Chapter 11 obligations, these debts will be provided for under the terms of a plan of reorganization. Rhodium’s management team is committed to developing a plan as quickly as possible,” the email continued.
According to the court filing, Rhodium’s estimated liabilities are between $50m and $100m, and the value of its assets are estimated between $100m and $500m
Rhodium is currently locked in an arbitration case against Riot Platforms regarding a former hosting agreement between the two companies at Riot’s Whinstone facility. Riot originally filed a petition in 2023 against Rhodium for breach of contract, seeking $26 million in damages. Rhodium filed a counterclaim last year and, as of a June 2024 amendment, is seeking $67 million in damages.
This is a developing story and we will update it when applicable.
