Block's Mining Client Dumps $41.9M Loss, Abandons Proto Chip Deal

Core Scientific has announced that it will terminate its contract with Block's mining hardware division, Proto Global LLC. The company had signed a procurement framework agreement with Block in July 2024 to purchase self-developed 3-nanometer mining chips from Proto.

The chips were intended for Bitcoin mining and had an estimated computing power of approximately 15 EH/s. However, Core Scientific has incurred a loss of $41.9 million due to the termination of remaining mining equipment purchase contracts with Block.

Despite this significant loss, Core Scientific is moving forward with its 'strategic transformation' plan by terminating the procurement obligations with Block's Proto division. The company has instead signed a 15-year lease agreement for data centers, which will generate over $14 billion in contract revenue.

Block's mining business has been facing challenges, and this development comes on top of several other setbacks. In November 2024, Block shut down its internal incubation projects for Bitcoin mining and the TBD department for Web5 identity.