Bitcoin’s mining company, Northern Data, blames the ‚trolls‘ after the stock fell by 40%

The European Bitcoin Mining Company (BTC), Northern Data, has seen its shares fall by 40% in days amid claims that it committed fraud.

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Bloomberg data showed that the company was trading in NB2 at less than EUR 47 (USD 53.70) at the end of July 17, compared to EUR 79 (USD 90.30) on Monday.

Northern Data: „We are as transparent as possible“

Northern Data, the product of a 2019 merger between U.S. company Whinstone and Northern Bitcoin, claimed to offer high performance computing / artificial intelligence (HPC/AI) solutions.

While promoting the scale of its computing capabilities to investors and analysts, including well-known German bank researchers, one critic in particular argued that, in fact, the company was primarily involved in hosting Bitcoin mining.

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For the well-known research user BTCKING555 from Twitter, suspicions were raised when Northern Data failed to answer basic questions about his business.

Thereafter, a publication in Medium delivered a longer exposure, after which Northern Data reached the mainstream media and its share price fell.

„This is a very unpleasant moment in time,“ Maximilian Martin, Northern Data’s chief financial officer, told the Financial Times.

„It gives anonymous trolls a power of influence. I don’t care because I know we are not criminals, that’s the main point of differentiation. We are as transparent as possible.“

Keeping the faith after Wirecard

The post in Medium doesn’t agree. By questioning everything from revenues to prices, it also casts doubt on the legitimacy of those who invested in the company itself, including the well-known crypto companies, SBI Holdings and The Block.

It sums up:

„As such we come to a conclusion:

1) Northern Data’s clients are paying lower, industry-competitive rates, and the company is cooking the books;

2) The company has found the crypt industry’s dumbest customers and milks them to the max for its huge gross margin of 40%.

The debacle is bleakly pertinent, coming weeks after another German scandal involving the financial firm Wirecard.

After $2 billion went unaccounted for, the company pulled out, and the side effects affected consumers around the world.

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All funds linked to Wirecard, such as prepaid debit cards, were suddenly frozen, leaving users without their money. As reported by Cointelegraph, Bitcoin’s debit cards were also affected.

Before its own difficulties, Northern Data was another example of the commercial fairness of cryptomonies that far outweighed cryptomonies, often thanks to roadmaps that included plans such as an initial public offering or IPO.