TL;DR
- LM Funding America expands its hosting contract with Core Scientific to add 900 new Bitcoin mining machines
- Total mining fleet reaches approximately 4,600 machines with a combined hashrate of 470 petahash
- Core Scientific to host roughly 3,900 machines for LM Funding, generating 400 petahash of capacity
- New machines expected to be fully operational by the end of April 2023
- Expansion signals continued confidence in Bitcoin mining despite Core Scientific’s ongoing bankruptcy proceedings
Bitcoin mining company Core Scientific is expanding its hosting partnership with LM Funding America, adding 900 additional mining machines to the fleet. The deal, announced on April 12, 2023, underscores the resilience of Bitcoin mining infrastructure partnerships even as the broader industry navigates a period of financial restructuring and market recovery following the turbulent events of 2022.
LM Funding America (NASDAQ: LMFA), a cryptocurrency mining and technology-based specialty finance company, revealed that the additional machines are expected to be fully electrified and operational by the end of April 2023. The expansion brings LM Funding’s total mining fleet to approximately 4,600 machines, generating a combined hashrate capacity of roughly 470 petahash per second.
Scale and Infrastructure Details
Under the expanded agreement, Core Scientific will host a total of approximately 3,900 mining machines on behalf of LM Funding, delivering an estimated 400 petahash of mining capacity from those machines alone. The remaining 700 machines are hosted at other facilities, contributing the balance of the company’s 470 petahash total hashrate.
Bruce M. Rodgers, Chairman and CEO of LM Funding, expressed confidence in the partnership. “We are happy that we have reached an agreement to expand our business relationship with Core to host an additional 900 bitcoin mining machines, bringing the total number of machines hosted by Core to approximately 3,900,” Rodgers stated. He emphasized that the rapid deployment timeline — with all new machines expected online within weeks — reflects the operational efficiency of the hosting arrangement.
Core Scientific’s Resilience Through Bankruptcy
The expansion deal is particularly notable given Core Scientific’s financial situation. The Austin-based mining firm filed for Chapter 11 bankruptcy protection in December 2022, citing the prolonged downturn in Bitcoin prices and rising energy costs throughout the year. At the time of its filing, Core Scientific was one of the largest publicly traded Bitcoin mining companies in North America by hashrate.
Despite the bankruptcy proceedings, Core Scientific has continued to operate its mining facilities and honor its hosting contracts. The company’s ability to onboard additional machines for LM Funding demonstrates that its data center infrastructure remains functional and competitive. For hosted mining clients like LM Funding, the continuity of operations through bankruptcy is critical — mining revenue depends on consistent uptime and access to affordable electricity, both of which Core Scientific’s facilities continue to provide.
LM Funding’s Growing Mining Operation
LM Funding America entered the Bitcoin mining business in September 2022, just months before the market reached its lowest point in the cycle. The company’s primary business has historically been specialty finance, providing funding to nonprofit community associations in Florida, Washington, Colorado, and Illinois. The pivot into cryptocurrency mining represents a strategic diversification.
Since launching its mining operations, LM Funding has rapidly scaled its fleet. Starting from zero, the company has built out a 4,600-machine operation in less than seven months. The latest expansion with Core Scientific represents a significant step up, adding nearly 25% more machines to the fleet in a single deployment.
The timing of the expansion aligns with a recovery in Bitcoin’s price, which has climbed back above $30,000 in April 2023 after spending much of late 2022 below $20,000. Higher Bitcoin prices directly improve mining economics, as the revenue generated per petahash of hashrate increases with the market price.
Industry Context and Hashrate Trends
The Bitcoin network’s total hashrate has been on a steady upward trajectory throughout 2023, reflecting broader industry recovery and new hardware deployments. As mining companies emerge from the challenges of 2022 — which included the collapse of several major industry players, skyrocketing energy prices, and a steep decline in Bitcoin’s value — the expansion of hosting contracts like the LM Funding-Core Scientific deal signals renewed confidence in the sector’s fundamentals.
For Core Scientific, continuing to attract and expand hosting clients during bankruptcy proceedings strengthens its case for successful reorganization. Revenue from hosting agreements provides stable, predictable income that is less directly exposed to Bitcoin price volatility than self-mining operations, making these contracts valuable assets in the restructuring process.
Why This Matters
The expansion of the LM Funding-Core Scientific hosting deal illustrates two important trends in Bitcoin mining. First, the industry is consolidating around large-scale, professionally managed data centers — even companies that entered the space recently are rapidly scaling through hosting partnerships rather than building standalone facilities. Second, the resilience of mining infrastructure through bankruptcy proceedings demonstrates the underlying durability of the sector’s physical assets. As Bitcoin’s price recovery continues and network hashrate reaches new highs, companies that maintained and expanded their operations during the bear market are well-positioned to capitalize on the upturn.
Disclaimer: This article is for informational purposes only and does not constitute financial advice. Cryptocurrency markets are highly volatile, and past performance is not indicative of future results. Always conduct your own research before making investment decisions.
470 petahash from 4600 machines is roughly 100 TH per unit. those are solid machines, probably S19 XP or similar
S19 XP Hyd at 140TH would put it at ~102TH average. makes sense if they mixed in some older S19j Pro units at lower hashrates
expanding a mining deal while in bankruptcy proceedings is wild. creditors must be loving the ‘keep mining’ strategy
LM Funding going all in on mining during a bear market with a bankrupt hosting partner. balls of steel or no due diligence, you decide
creditors would rather have mining revenue than a liquidation fire sale. the math works if BTC stays above their energy costs
creditors approved the plan because continued mining generates revenue for repayment. shutting down the rigs would have been worse for everyone
the revenue from 470 PH during a recovery phase probably covered their restructuring costs. smart move by the creditor committee
expanding during bankruptcy wasnt ballsy it was the only play. liquidating S19s at 30 cents on the dollar would have recovered pennies for creditors
900 machines added in april 2023 when BTC was around 28k. LM funding timed the expansion pretty well looking back
470 PH coming online in april 2023 when BTC was crawling back from 16k. LM Funding timed it pretty well, machines were live right as the recovery kicked in