Canadian mining firm goes belly up; Owes local, federal government hundreds of thousands
Canadian government-assisted Great North Data crypto mining firm has now filed for bankruptcy owing taxpayers hundreds of thousands.
Fri, 06 Dec 2019, 03:56 am UTC
Another Canadian crypto company has gone belly up, this time involving a mining firm. Great North Data has filed for bankruptcy in late November as its liabilities far outstrip its current assets.
To be specific, the crypto mining company has a reported CA$4.6 million (US$3.5 million) in assets but is facing a liability figure of CA$13.2 million (US$10 million). Great North Data is backed by the federal and provincial governments.
Among them is the Atlantic Canada Opportunities Agency (ACOA) that is fostering the economic growth of the province. In 2015, ACOA gave Great North Data CA$500 (US$379,315.00). The firm now owes the agency CA$281,675 ($US213,687), CBC reported.
ACOA told the publication that it’s currently in contact with the mining company and is keeping a close eye on future developments.
More creditors owed
Meanwhile, secured creditor Business Investment Corporation of the provincial Newfoundland and Labrador government is owed CA$313,718 ($US237,995). The money is tied to Great North Data’s assets including machinery and equipment, as well as land and building located in Labrador City.
Other unsecured creditors are Newfoundland and Labrador Hydro and the Business Development Bank of Canada, which the mining firm owes $CA316,477 (US$240,088) and CA$225,000 ($US 170,691) respectively.
A failed plan
According to an archived statement from June 26, 2018, Canadian MP Yvonne Jean Jones visited one of the company’s centers. Jones said that Great North Data has allocated $9 million to its operation in the span of five years, $5-6 million of which went to contractors and equipment that was mostly sourced from Labrador, The Block reported.
“They currently employ 25 full-time and 4 part-time staff, and have intentions to grow this number with an additional 15-20 full time employees by December 2018. The company anticipates sales exceeding $6 million by the end of this year, which should only double throughout 2019,” the archive statement read.
Great North Data is but the latest Canadian crypto company that went belly up following the massive scandal that QuadrigaCX and Einstein Exchange brought this year. Canada has been trying to place fair restrictions on this nascent market and has been seeking counsel from the fintech community how to create a sound regulatory framework, CoinDesk reported.
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