BitRiver faces bankruptcy: When the energy advantage cannot save the business
As you can see, BitRiver was once a pride of the Russian mining industry thanks to leveraging cheap electricity and a cold climate. But here's the thing, the latest reports show that this company is sinking into crisis. The fact that CEO Igor Runets is under house arrest due to tax evasion allegations, along with the court opening bankruptcy supervision procedures against the major shareholder holding 98% of the capital, is a severe blow to their reputation.
The trouble stems from a dispute over equipment worth 9.2 million USD that BitRiver cannot deliver despite having received payment in advance. As accounts are frozen and electricity debts pile up, the ability to maintain large-scale mining operations is extremely low. For you, this is a reminder that the risks in the mining industry are not only related to Bitcoin prices but also to legal issues and corporate governance. Once the operational machinery is paralyzed, no matter how abundant the resources are, the outcome is very unpredictable. You should be cautious if you intend to invest in rental mining services related to this area. $BTC
