Venezuelan Businessman to Buy HashFast's Remaining Chips, Judge Bewildered as Bankruptcy Saga Takes Another Bizarre Turn

UPDATE December 10 10:17 GMT: According to an update in the Ars Technica article, the Guido Ochoa discussed is not the Venezuelan politician, but a different Guido Ochoa in the plastics industry. Our article has been amended accordingly.

In its most recent coverage of the unfolding HashFast bankruptcy, Ars Technica reports that a Venezuelan businessman, Guido Ochoa, will buy the company's entire remaining lot of chips for $420,000.

The company reportedly owes $40 million to creditors, with CEO Eduardo deCastro saying that the company is "as poor as church mice....cash poor and inventory rich."

Ochoa runs a plastics recycling business. Noteworthy is that Ochoa was HashFast's second biggest customer, having previously spent $800,000 with the company.

In a bizarre twist, Ochoa's purchase is dependent upon allowing HashFast to buy mining boards built by Ochoa with the company's inventory, at cost. The company would then sell the hardware for a profit to the market at attractive prices. Similarly, Ochoa would sell to the company "a future, fully integrated mining board that is scheduled to be developed early next year."

The judge presiding over the case expressed bewilderment at the arrangement, comparing it to "a patient that is going to die from three different things" and then adding a fourth surgery. The last thing the company should be doing is spending more money on mining equipment, although in theory, the plan allows it to generate some cash for creditors. He continued:

"The observation that I’ve had since Day 1: I've expressed the unusualness of this new business called Bitcoin Bitcoin While some may still be wondering what is Bitcoin, who created Bitcoin, or how does Bitcoin work, one thing is certain: Bitcoin has changed the world.No one can remain indifferent to this revolutionary, decentralized, digital asset nor to its blockchain technology.In fact, we’ve gone a long way ever since a Florida resident Laszlo Hanyecz made BTC’s first official commercial transaction with a real company by trading 10,000 Bitcoins for 2 pizzas at his local Papa John’s.One could now argue that While some may still be wondering what is Bitcoin, who created Bitcoin, or how does Bitcoin work, one thing is certain: Bitcoin has changed the world.No one can remain indifferent to this revolutionary, decentralized, digital asset nor to its blockchain technology.In fact, we’ve gone a long way ever since a Florida resident Laszlo Hanyecz made BTC’s first official commercial transaction with a real company by trading 10,000 Bitcoins for 2 pizzas at his local Papa John’s.One could now argue that Read this Term coming into our old familiar Bankruptcy Bankruptcy Bankruptcy or insolvency constitutes a legal term and refers to being unable to repay debts. A business and a person can declare bankruptcy. When a person or company claims bankruptcy, it is described as a voluntary bankruptcy, and when your debtors force you into bankruptcy, it is referred to as involuntary. A voluntary bankruptcy occurs when the debtor or borrower, the party that owes the money files with the courts. Involuntary bankruptcy happens when your credits file a petition with the co Bankruptcy or insolvency constitutes a legal term and refers to being unable to repay debts. A business and a person can declare bankruptcy. When a person or company claims bankruptcy, it is described as a voluntary bankruptcy, and when your debtors force you into bankruptcy, it is referred to as involuntary. A voluntary bankruptcy occurs when the debtor or borrower, the party that owes the money files with the courts. Involuntary bankruptcy happens when your credits file a petition with the co Read this Term world, and I find it beyond belief that someone who understands Bitcoin wouldn't have the slightest interest under the bankruptcy code. I'm going to defer to the judgement of the committee and the judgement of the debtor."

He was also puzzled why the company didn't convert the bankruptcy from Chapter 11 to Chapter 7.

Prior to this arrangement, creditors and the company had agreed to auction off the company's assets this past Friday, but it was cancelled because all bids were considered "lowball." Simon Barber, a co-founder and chief technology officer, was the sole bidder to buy the company's remaining debt. He offered $20,000 cash and up to 60 hours of consulting services.

The exact cause of the company's downfall, characterized by delayed/unfulfilled pre-orders and refunds, remains unclear. The company has previously indicated that it is a victim of a string of mishaps and unreliable partners.