Former Crypto Mining Giant Poolin Files for Bankruptcy
Poolin Technology, once one of the world’s biggest Bitcoin mining pools, has filed Chapter 11 bankruptcy in the United States. The Singapore-registered company relocated after its Texas mining and hosting sites closed on July 10.
Two American affiliates, Lonestar Dream Inc. and Lonestar Taproot LLC, are part of the filing too. Court records show Poolin has 10 to 25,000 creditors. Its assets fall between $1 million and $10 million, while its liabilities range from $100 million to $500 million.
Customers Are Owed Millions
The company owed approximately $173.1 million before it filed, says Chief Restructuring Officer Michael DuFrayne. In fact, the majority of that debt is unpaid IOUs, totalling about $163.7 million, from Poolin Wallet customers.
Withdrawals were suspended by Poolin during the 2022 crypto crash, resulting in a growing amount of these IOUs. There are approximately 11,700 retail customers who continue to hold IOUs valued over $100 each, which are still frozen.
Poolin has no comeback plans. Rather, it is set to liquidate nearly all its U.S. mining operations to repay its debt.
Selling Off the Assets
Poolin already has a contract with Thor CALAP LLC who will define the initial auction price. Poolin’s total assets come to $52 million with the offer. That includes $15 million for the Pyote site and $37 million for the Tarbush site.
There’s still time for other bidders. Both properties could be sold separately to max out returns for creditors, contingent upon approval by a bankruptcy judge.
A Fall From the Top
Kevin Pan, Fa Zhu, and Tianzhao Li founded Poolin in China back in 2017. In 2019, it was one of the biggest mining pools in the world.
But all that changed once China banned Bitcoin mining in 2021. Poolin moved to the US but borrowed $213 million in crypto assets. However, with the collapse in prices in 2022 the collateral’s value evaporated, and Poolin was not able to pay off its creditors or refund customer funds in 2023.
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