Singapore-based bitcoin mining company Poolin on July 22 filed for Chapter 11 bankruptcy protection in New Jersey, along with its U.S. affiliate Lonestar Dream Inc. and Lonestar Taproot LLC. The company is also seeking court approval for the $52 million sale of its mining properties in Texas.
The bankruptcy filing comes nearly four years after Poolin froze customer withdrawals, leaving thousands of wallet users with IOU tokens and turning a mining business failure into a protracted creditor dispute.
Poolin enters Chapter 11 with $173 million in liabilities
Court records foot In the U.S. Bankruptcy Court for the District of New Jersey, Bolin showed that the number of creditors ranged from 10,001 to 25,000, and the assets of the petition were estimated at between $1 million and $10 million.
The announcement by Chief Restructuring Officer, Michael Dufrayne, identified pre-commitments of approximately $173.1 million, with approximately $163.7 million associated with unsecured debt securities issued to Poolin Wallet clients.
The company’s current bankruptcy case focuses on selling its Texas assets rather than rebuilding its mining operations. Lonestar Dream halted mining and hosting activities at its Pyote and Tarbush sites on July 10, according to filing documents.
Poolin has entered into asset purchase agreements with Thor CALAP LLC for a combined offering of $52 million. The offering includes $15 million for Pyote’s equity and associated energy rights and equipment, as well as $37 million for Tarbush’s energy rights and equipment. The deal remains subject to competing bids and court approvals.
The company spent more than three months marketing the asset, reaching out to more than 335 potential buyers, including cryptocurrency miners, artificial intelligence and high-performance computing operators. The process resulted in 28 confidentiality agreements, seven letters of intent, and three additional expressions of interest.
Poolin’s expansion into Texas has faced difficulties after the company moved its mining operations from China as Beijing imposed a mining ban in 2021. It expected to receive up to 600 megawatts of power, but only 100 megawatts were delivered. This meant that the equipment the company purchased for its US operation ended up being more than was necessary.
Some of that equipment was sold, resulting in a loss of $8.8 million from fiscal year 2023 to 2025. Ultimately, Lonestar Dream and Lonestar Taproot accumulated losses of about $45.9 million.
The collapse of Poolin’s portfolio remains central to creditors’ claims
Poolin’s financial woes go beyond mining. In June 2022, when Bitcoin fell below $20,000, it led to margin calls from Tether in exchange for collateral the company had pledged through the Poolin wallet. It then transferred almost all of this collateral to Antalpha and borrowed about $213 million against crypto assets worth just under $356 million.
However, in September 2022, Poolin Wallet was released hanging Withdrawals and Issued Nearly $163.7 million worth of IOU tokens are available to customers, with about 11,700 wallet users holding balances of more than $100, according to the filing.
Bitcoin later fell below $16,800 in November 2022, after which Poolin ceased operations, and Antalpha liquidated the collateral. Management estimated that about $260 million was owed to Antalpha for digital assets valued at about $265 million at the time.
Poolin was once one of the largest Bitcoin mining pools globally, reaching nearly 14% of the Bitcoin network’s mining share in 2019. However, the company’s remaining value now depends on the sale of Texas assets and the outcome of the bankruptcy process.
The court-supervised auction will determine how much creditors will recover, and any distribution will depend on competing bids, sale expenses, administrative claims, and approval of the proposed liquidation plan.
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