This article was originally published on October 7, 2021.
In 2020, an article — Northern Data — A Shady Bitcoin Mining Host, camouflaging under High Performance Computing/Artificial Intelligence Story — posted to Medium claimed the company was playing down its reliance on Bitcoin miners. There’s a link to the article below.
GMO Internet filed a lawsuit against Whinstone, US, and Riot Blockchain in June, 2022. The lawsuit seems to corroborate the article posted to Medium. See the link to lawsuit below.
Bitcoin miner allegedly manipulated stock markets with overhyped merger
by Protos Staff
Regulators are circling Bitcoin company Northern Data over its acquisition of US-based crypto miner Whinstone, reports Bloomberg.
The Frankfurt-based firm — which previously did business as Northern Bitcoin — purchased Whinstone in 2019 in an all-stock deal.
Northern Data announced the merger shortly after Whinstone began work on a new 100-acre, one-gigawatt Bitcoin mining facility in Texas.
At the time, the company pegged the plant as the “world’s largest Bitcoin mining facility.”
However, Germany’s Federal Financial Supervisory Authority (BaFin) alleges that Northern Data overvalued the deal.
Per Financial Times, Northern Data predicted revenues of €120 million to €140 million ($138.7 million to $161.8 million) and an operating profit of €45 million to €60 million ($52 million to $69.3 million).
When the company revealed figures last week, the figures were well below the mark: €16.4 million ($19 million) revenue (nearly 90% less) with an operating loss of €12.3 million ($14.2 million).
Northern Data stock fell up to 45% after BaFin filed its complaint last week. It has since rebounded, now sitting at around 25% below its pre-complaint share price.
Northern Data’s market value currently sits at $1.27 billion.
Northern Data says offloading Whinstone proves it’s all good
BaFin copped flak for not detecting the impending collapse of German payment processor Wirecard last year.
So, the markets watchdog no doubt hopes allegations of market manipulation against Northern Data stick.
But Northern Data, which counts among its investors German magic mushroom king Christian Angermayer, isn’t taking the claims lying down.
It blamed the disparity on its failure to realize revenues with two of its major customers — Bitfield and Decentric.
In a statement released via its website on Tuesday, the company added:
We reject the allegations made therein, in particular of market manipulation. We are confident that we will clarify the matter in full cooperation with the authorities.
Northern Data also pointed its recent sale of Whinstone to Riot Blockchain for $80 million and 11.8 million Riot shares (now worth $310 million) as proof of “the high value of the acquisition.” (The Northern Data founder and The Whinstone US founder are the same person. Chad Everett Harris the CEO with Whinstone).
This isn’t the first time Northern Data has been accused of fudging facts.
Behind the Videos, Marketing & Hype – Whinstone, Chad Everett Harris, Riot, and Northern Data
Find the Northern Data — A Shady Bitcoin Mining Host, camouflaging under High Performance Computing/Artificial Intelligence Story article posted here.
Chad Everett Harris, Whinstone US, RIOT Blockchain, sued for $50MM, click here.
Chad Everett Harris, Whinstone, Riot Blockchain, Northern Data AG accused of accounting fraud Read that article here.
Chad Harris defaults on million dollar loan, click here to learn more. Be sure to read the court doc. It’s a hoot, He tries to play the victim. The judge ain’t buying it.
Chad Everett Harris owned this business while defaulting on loans and invoices. Click here to learn more.
Chad Everett Harris is a porn spammer? We believe he did that while sending email like these to the people he owed money to.