Canadian Government-Assisted Bitcoin Miner Files for Bankruptcy Owing Millions

Great North Data, a firm that ran bitcoin mining and AI processing data centers in Canada, has filed for bankruptcy.

According to bankruptcy filings late in November, the firm has just 4.6 million Canadian dollars (US$3.5 million) in assets, but owes creditors CA$13.2 million (US$10 million), CBC News reported Wednesday.

Having run centers in Labrador City and Happy Valley-Goose Bay, both in the province of Newfoundland and Labrador, Great North Data had received business support from federal and provincial governments.

Atlantic Canada Opportunities Agency (ACOA) is listed as an unsecured creditor owed CA$281,675. The Canadian government agency aims to create opportunities for economic growth in the Canadian Atlantic region.

The ACOA had funded the firm to the tune of CA$500,000 back in 2015 – money that was to be repaid under an agreement. The agency told CBC News that it is “in contact with the client and are closely following all developments” regarding the bankruptcy.

The data processor also owes CA$313,718 to the Business Investment Corporation of the provincial Newfoundland and Labrador government. That funding is tied up in Great North Data assets, including building, land and equipment, and arises from a loan of CA$420,000, according to the report.

Additionally, Great North Data leaves a hefty power bill still to be paid, with Newfoundland and Labrador Hydro listed as an unsecured creditor owed CA$316,477.

No specific reasons are provided for the company’s collapse in the report, but the bankruptcy came amid record mining difficulty and falling bitcoin prices.

Even so, some players are still entering the game, with data center developer Whinstone US recently starting construction of what will likely be the world’s biggest bitcoin mining center in Texas, in partnership with GMO Internet.