• Riot Platforms (RIOT) unit, Whinstone US, is suing Rhodium Enterprises for alleged unpaid hosting fees of $26 million.
• The disagreement stems from participation in demand response programs in Texas, where bitcoin miners get power credits to limit their energy consumption.
• Riot is asking the court to declare that they don’t owe any credits related to demand response programs and that Rhodium was amassing power credits on their books without rights.
Bitcoin Miner Riot Sues Peer Rhodium Enterprises
Riot Platforms (RIOT) unit, Whinstone US, is suing another miner – Rhodium Enterprises – alleging it is owed $26 million in hosting fees. According to a petition obtained by CoinDesk, the lawsuit claims that Rhodium has deliberately miscalculated how much it had to pay for Riot’s hosting services and short-changed Whinstone. The civil case was filed with the district court of Milam County in Texas on May 2.
Unpaid Fees Allegations
Riot claims that it tried to collect payments from Rhodium in May 2022 and April 5 but the company refused or failed to do so. Separately, Riot alleges that four of Rhodium’s subsidiaries were amassing power credits on their books without rights for two years. As a result, Riot wants the court to declare that it doesn’t owe any such credits or money related to demand response programs from its peer miner.
Demand Response Programs
Participation in demand response programs in Texas are at the core of this dispute between the two mining firms. Such programs provide bitcoin miners with power credits when they limit their energy consumption which could have had a legal basis from previous contracts but those were superseded by the December 2020 agreements between Whinstone and Rhodium Enterprises.
Whinstone Refuses Request
Rhodium asked Whinstone last October to verify if they were owed power credits unrelated to expired contracts but Whinstone rejected this request and asked the court instead for a declaration of no obligation towards Rhondium’s units’ demands which led them to file a lawsuit against them for breach of contract on May 2nd 2023 .
In conclusion, Bitcoin mining firm RIOT’s unit, Whinstone US has sued miner Rhodium Enterprises over allegedly unpaid hosting fees amounting up too $26 million while also accusing them of amassing power credit which they did not have rights too since December 2020 leading them both into a district court hearing over breach of contract allegations set for early May 2023 .