Crypto Mining Firm Riot Files Lawsuit Against BTC Miner Rhodium Over $26M in Unpaid Fees

Crypto mining firm Riot Platforms (RIOT), formerly known as Riot Blockchain, has filed a lawsuit in the District Court of Milam County in Texas against bitcoin miner Rhodium Enterprises alleging that the latter has failed to pay $26 million in hosting fees.

In its Q1 2023 financial report published last week, Riot claimed that Rhodium “deliberately miscalculated” how much it had to pay in hosting fees for Riot’s services. According to the lawsuit, the two companies intended to split the net income from Rhodium’s mining at the Whinstone facilities, a wholly owned subsidiary of Riot. The lawsuit further claimed that Rhodium cheated Whinstone between 2021 and the first quarter of this year of $26 million.

“Whinstone asserts breach of contract claims for Rhodium’s failure to pay certain hosting and service fees under certain hosting agreements and seeks a declaration that certain hosting agreements with Rhodium are terminated and that no power credits are owed to Rhodium under any agreement,” the report said.

According to the report, Rhodium was served on May 8, with a deadline to respond by May 30. Riot noted that it is difficult to predict whether or not the unpaid fees will be recovered at this point.

“Because this litigation is still at this early stage, we cannot reasonably estimate the likelihood of an unfavorable outcome or the magnitude of such an outcome, if any,” the report said.