The Poolin group has filed for Chapter 11 bankruptcy protection in the U.S. to sell its mining assets in Texas and wind down operations. The case is being heard in New Jersey.

The filing is made on behalf of Singapore-based Poolin Technology PTE. LTD., along with its U.S. affiliates Lonestar Dream Inc. and Lonestar Taproot LLC.

The document lists between 10,001 and 25,000 creditors, assets ranging from $1 to $10 million, and liabilities between $100 and $500 million. According to a declaration by restructuring director Michael Dufresne, the debtors' pre-petition obligations are estimated at approximately $173.1 million.

He stated that the process is not aimed at preserving Poolin as an operating business. The goal is to conduct a court-approved asset sale under Section 363 of the U.S. Bankruptcy Code.

On July 10, Lonestar Dream halted mining and hosting operations at the Pyote and Tarbush sites in West Texas. A limited staff remains on-site for security and preparation for the sale. Thor CALAP LLC has offered $15 million for the Pyote site, along with associated power rights and equipment. An additional $37 million is on the table for the rights to power and equipment at Tarbush.

This $52 million will serve as the starting bid, establishing a minimum price ahead of the auction. The assets may be sold separately or as a package if a more favorable offer arises and is approved by the court.

Before filing, Poolin's consultants conducted a three-month search for buyers and investors. According to the court declaration, they reached out to over 335 potential participants, including operators of AI and high-performance data centers, hyperscalers, real estate funds, private equity funds, and miners.

The process yielded 28 non-disclosure agreements and seven preliminary offers: two for the Pyote assets, three for the rights to power and equipment at Tarbush, and two for both sites.

Poolin Has Not Recovered from the 2022 Crisis

Founded in China in 2017 by Zhijiao "Kevin" Pan, Fa Zhu, and Tianzhao Li, Poolin was considered the largest cryptocurrency mining pool in the world by September 2019, according to the court declaration.

Additionally, the company developed Poolin Wallet, which allowed users to borrow USDT against crypto assets and invest in deposit products.

After China banned mining in 2021 and the cryptocurrency market crashed in 2022, the business model came under pressure. The firm transferred the collateral of Poolin Wallet clients to Antalpha Technologies and borrowed about $213 million against crypto assets valued at approximately $355.8 million, according to the court declaration. The funds were used for developing U.S. sites, purchasing mining equipment, client payouts, interest, and operational expenses.

In September 2022, Poolin Wallet suspended withdrawals due to a liquidity crisis and issued IOU tokens. Court documents indicate that around 11,700 clients had balances exceeding $100.

In November, Antalpha liquidated the collateral of Poolin Wallet. At that time, management estimated the debt at around $260 million against digital assets of approximately $265 million. The Singapore-based Poolin has not operated normally since 2022. Among the company's remaining assets, TheEnergyMag reported about $1.2 million in a New Jersey bank account, office leases, and intercompany receivables.

The Texas Project Proved Unprofitable

After the crisis, Poolin attempted to restructure its business around mining in the U.S. According to the court declaration, the company explored over 30 sites and selected the Pyote and Tarbush locations in Texas in 2021.

According to TheEnergyMag, the initial plan included connecting up to 600 MW of power, but the sites only received 100 MW in the first phase. Poolin ordered more equipment than it could accommodate and subsequently sold the excess at a discount.

Unaudited company records indicated approximately $8.8 million in losses from equipment sales for the 2023-2025 fiscal years. Since their inception, Lonestar Dream and Lonestar Taproot have accumulated about $45.9 million in combined losses.

As of May, Lonestar Taproot reported a net book value of fixed assets at $41.7 million, the publication noted. In December 2023, China Green Agriculture entered into an agreement to purchase the firm from Zhijiao Pan for $49 million. TheEnergyMag indicated that the deal did not close, and at the time of filing, Pan remained the sole shareholder of Lonestar Dream.

Court documents also indicate that several wallet holders have filed lawsuits against the debtors in the U.S. and Singapore. Any potential recovery for them will depend on the final sale price of the assets, selling expenses, administrative costs, and court approval of the liquidation plan.

As of this writing, Poolin controls 0.24% of Bitcoin's hashrate. In comparison, the leader, Foundry USA, holds 26.1%.

Source: Hashrate Index.

It is worth noting that in June, companies CleanSpark, BitFuFu, and Canaan reported a decline in Bitcoin production, despite mining difficulty dropping to a minimum for 2026.