Poolin Technology PTE. LTD., along with its two affiliate entities, Lonestar Taproot LLC and Lonestar Dream Inc., officially filed for Chapter 11 bankruptcy protection in a New Jersey court on July 22, 2026. Court documents show that the debt liabilities of the company, which once dominated the Bitcoin mining landscape, range between $100 million and $500 million.
These three cases are being jointly administered under the umbrella of the main Poolin case, number 26-18325, presided over directly by Judge Eamonn J. O’Hagan. This Chapter 11 legal move was filed with the primary goal of facilitating an orderly asset sale process to protect the remaining value for creditors.
Liquidity Cracks Since Two Years Ago
Warning signs from within Poolin had already been flashing brightly since September 2022. At that time, a liquidity crisis forced management to suspend all customer withdrawals from the PoolinWallet platform. As a temporary solution, they issued six types of IOU tokens for BTC, ETH, USDT, LTC, ZEC, and DOGE assets at a 1:1 exchange ratio.
On the operational side, Lonestar Dream’s mining activities had almost completely ground to a halt shortly before this bankruptcy filing was initiated, accompanied by the termination of Elektron Energy’s customer service. Meanwhile, Lonestar Taproot is known to control mining infrastructure assets, including an electrical substation. Between March 2022 and December 2023, Lonestar Taproot operated as a partnership between Lonestar Dream and hardware giant Bitmain. During this partnership period, Bitmain invested an initial capital of $34.4 million but eventually exited the collaboration, recovering only the remaining $24.1 million after recording substantial losses.
Hashprice Falls Below Breakeven Line
Poolin’s collapse coincided with an increasingly hostile business climate for crypto mining. Entering mid-2026, the miner revenue metric, or hashprice, remains stuck in the $20s per petahash per day range. This figure is far below the breakeven revenue level of $35 required for older generation mining machines to remain operational.
This post-halving cost pressure triggered a massive sell-off of reserves in the crypto industry. Throughout the first quarter of 2026, a series of public mining companies recorded record asset liquidations, selling more than 32,000 BTC into the market to mitigate the impact of the slumping hashprice.
How Much Money Can Still Be Saved
Now, the legal phase is shifting toward the liquidation of physical assets. On August 17, 2026, the New Jersey court officially approved the bidding procedures to acquire nearly all assets belonging to Poolin and its two affiliates. Potential buyers have been given a deadline of September 8 to submit their bids.
If more than one highly competitive bid emerges, this phase will proceed to an open auction on September 10. The final outcome of the sale of all these assets will then be heard in court in Trenton on September 18 at 11:00 AM ET. In the immediate schedule, the first meeting between creditors and management has been set for August 28, 2026, though the deadline for submitting debt claims has not yet been decided by the court.
For creditors whose funds are still stuck in the system, next month’s auction process will determine how much asset value can still be recovered from Poolin’s collapse. Reported from crypto.news.
Read also: What Is Bitcoin Halving?
Disclaimer: This article is for informational and educational purposes only, not financial advice. Cryptocurrency assets are highly volatile and carry significant risk. Always do your own research (DYOR) and never invest more than you can afford to lose.
