Riot Platforms, a company that mined cryptocurrencies and was previously known as Riot Blockchain, has filed a lawsuit against Rhodium Enterprises, a bitcoin miner headquartered in Texas. It attempts to collect more than $26 million in allegedly unpaid mining facility fees.
Rhodium Enterprises was the subject of a petition submitted to the Milam County Court in Texas on May 2, seeking to collect “more than $26 million” and be compensated for any legal bills that may have been expended.
According to the quarterly financial report for Riot Platform for the period ending March 1, 2023, which was released on May 11, Rhodium is said to have violated its contract with Riot by failing to pay the hosting and service costs connected with utilizing Whinstone’s bitcoin mining facilities, which is a wholly owned subsidiary of Riot.
In addition, Riot asked permission to terminate “certain hosting agreements” with Rhodium and proposed to be excused from repaying any outstanding power credits upon discontinuation.
Rhodium was given notice on May 8 and given until May 30 to respond to the claim. The report also disclosed that Riot had mined 2,115 bitcoins in the first quarter of 2023, a rise of 50.5% compared to the first quarter of 2022.
Riot is not part of banks’ saga
It was emphasized that Riot was not connected to the most recent round of bank failures.
“We do not have any banking arrangements with Silicon Valley Bank, Silvergate Bank, or First Republic Bank, and all of our cash and cash equivalents are currently held with a number of other financial institutions.”
Riot forecasts that cryptocurrency mining enterprises will continue to have difficulties in 2023 due to the significant price decline of bitcoin and other national and global macroeconomic factors.
It has been noted that Riot’s “relative position” in the industry, in addition to its “liquidity and absence of long-term debt,” makes it well-positioned to “benefit from such consolidation.”