Crypto miner Core Scientific to go public via US$4.3 billion SPAC deal

Crypto miner Core Scientific to go public via US$4.3 billion SPAC deal

Illustration of Ethereum
A representation of the virtual cryptocurrency Ethereum is seen among representations of other cryptocurrencies in this picture illustration taken Jun 14, 2021. (Photo: REUTERS/Edgar Su)

NEW YORK: Core Scientific Holding said on Wednesday it would go public through a merger with a blank-check company backed by BlackRock, in a deal that values the cryptocurrency miner at US$4.3 billion.

The deal with Power & Digital Infrastructure Acquisition Corp will fetch US$300 million in cash proceeds, but the companies did not disclose a private investment in public equity (PIPE) round that typically accompanies blank-check mergers.

Core Scientific said it had mined 928 bitcoins in the second quarter and forecast revenues of US$493 million and US$1.1 billion for fiscal 2021 and 2022, respectively.

The company said it was 100 per cent net carbon neutral and aims to remain so as it grows. Bitcoin is virtual but mining the asset consumes a lot of energy as it is created using high-powered computers around the globe.

Some cryptocurrency firms have recently managed to gain sky-high valuations, even as investor enthusiasm has waned for the digital assets whose values have plunged following global regulatory crackdowns.

Bullish, a crypto firm backed by billionaire entrepreneur Peter Thiel, agreed to a US$9 billion blank-check deal earlier this month, while FTX Trading on Tuesday said its valuation had risen to US$18 billion following a fresh funding round.

Despite the wild price swings in bitcoin, the most popular cryptocurrency, conglomerates like Japanese investment giant SoftBank Group Corp have given their seal of approval to some crypto firms including FTX and Mercado Bitcoin.

Special purpose acquisition company (SPAC) Power & Digital raised US$345 million in an upsized initial public offering in February.

SPACs use the pool of capital raised through their IPOs to merge with a private company and take it public, typically within two years of listing.

Source: Reuters