Poolin Initiates Chapter 11 Bankruptcy as Cryptocurrency Market Decline Takes Toll
Poolin, a leading cryptocurrency mining pool operator, has initiated Chapter 11 bankruptcy proceedings in the United States. The Singapore-headquartered firm, along with its American subsidiaries Lonestar Dream Inc. and Lonestar Taproot LLC, submitted voluntary filings on July 22 in the US Bankruptcy Court for the District of New Jersey.
Court documents indicate that Poolin faces estimated liabilities ranging from $100 million to $500 million, with assets valued between $1 million and $10 million. The bulk of its debt, around $163.7 million, stems from unsecured IOUs provided to Poolin Wallet users following the suspension of withdrawals amid the 2022 cryptocurrency market decline.
The bankruptcy aims to enable a supervised sale of assets, including two Texas-based facilities in Pyote and Tarbush, which halted mining activities on July 10. The companies have secured asset purchase agreements with Thor CALAP LLC for $52 million, which functions as a stalking-horse bid under Section 363 of the Bankruptcy Code.
The process is expected to yield some recovery for unsecured creditors, including wallet holders, though the precise amount will hinge on final auction results and court authorization of a liquidation plan.