Blockware Sues Mawson Firms for Unpaid Bitcoin Mining Equipment

On Friday, April 19, 2024, Bitcoin mining firm Blockware Solutions filed a lawsuit in federal court in New York against Mawson Bellefonte and Mawson Infrastructure Group, alleging breach of contract and other claims relating to unpaid equipment.

According to the court documents, Blockware Solutions is a cryptocurrency mining hardware seller based in Delaware. Mawson Infrastructure is a publicly traded bitcoin mining company headquartered in Pennsylvania that owns and operates bitcoin mining facilities. Mawson Bellefonte is listed as a Mawson Infrastructure subsidiary.

The suit stems from a contract signed in May 2023, where Blockware agreed to sell mining equipment it left at a Mawson Bellefonte facility in Bellefonte, Pennsylvania for $350,000. The equipment included power distribution components used for Bitcoin mining. Under the terms, $114,400 from a past debt was credited to Mawson Bellefonte, leaving a balance of $235,600 to be paid in installments.

Blockware claims it fulfilled its obligations by leaving the equipment as agreed. Mawson Infrastructure made the initial payment of $60,600 which was due within 10 days. It also paid the June and July installments of $35,000 each on time. However, Blockware alleges Mawson Bellefonte and Mawson Infrastructure failed to make the subsequent payments due in August, September, and November of last year despite invoicing.

With late fees, Blockware asserts it is owed $115,500. It is seeking monetary damages exceeding $474,000, claiming lost profits from an inability to reinvest the unpaid funds into other cryptocurrency opportunities. Blockware argues both defendants are liable for breach of contract and Mawson Infrastructure should also be held accountable under an alter ego theory since the subsidiary is dominated by the parent company.

The suit offers a glimpse into the multi-million dollar bitcoin mining industry, which involves using powerful computers and energy-intensive equipment to verify crypto transactions and earn new bitcoins. It remains to be seen how the courts will rule in this contract dispute between two firms operating within the decentralized blockchain and cryptocurrency sector.

Please contact BlockTribune for access to a copy of this filing.