Virtual Citadel Inc. and four related business entities filed for Chapter 11 on Feb. 14 in federal bankruptcy court in Atlanta, listing assets and liabilities of between $1 million and $10 million (read the complete filing here).
Virtual Citadel and its related businesses own and operate numerous computers that mine Bitcoin twenty-four hours a day, seven days a week. Bitcoin is a cryptocurrency created by using powerful computers to solve complex cryptographic problems.
The companies’ bitcoin mining operation is located at 2380 Godby Road in College Park, Marshall Glade, the company’s chief restructuring officer, says in a court document.
In addition to the Godby Road property, the companies own a data storage facility in West Midtown located at 1120 Curran Street, NW, Atlanta.
Virtual Citadel and its related businesses were founded by Michael L. Oken, who died suddenly and unexpectedly in October 2019, Glade said in the court document. The companies employ about 15 people.
Glade said the companies’ financial situation “is precarious at best,” and that it is in the best interest of their creditors to sell their assets. The companies have located a buyer, Block Data Processing Corp., that is willing to purchase the companies’ bitcoin mining operations and related real estate.
Bitcoin mining is a very power-intensive and hardware-intensive process. The companies in 2019 spent approximately $259,610 each month on utilities, with the bulk of the expense being for electric utility payments for their operations, the court document says. Read more about the company’s Chapter 11 filing here.