C7 Data Centers has filed a lawsuit against its customer CoinTerra, a provider of bitcoin mining services.The customer has allegedly not been paying its bills for services it has been receiving from the Bluffdale, Utah-based data center provider.The lawsuit, in which the plaintiff is seeking to recover about $5.4 million in damages, comes at a difficult time for all players in the bitcoin ecosystem.The digital currency’s value has been falling steadily since hitting a high of nearly $1,200 at one point in 2014.It is currently below $280, prompting one cloud mining service provider, CEX.io, to halt mining altogether, saying it was no longer profitable.The company’s CIO Jeffrey Smith told CoinDesk that it will start mining again if the price exceeds $320.CoinTerra manufactures and sells bitcoin mining hardware and hosts and manages mining hardware for customers as a service.A Redditor who claims to be a customer of CoinTerra’s bitcoin mining services said in a Reddit post two day ago that the company did not send him or her their weekly payout.

The Redditor pasted a statement they received from CoinTerra’s legal department, saying the company had defaulted on debt, and that its lenders had liens on all of its assets, including servers.CoinTerra has been a C7 customer since April 2014, using its colocation, hosting, monitoring, and management services.The 18-month contract is for services in three separate C7 data centers, according to summary of the allegations in the lawsuit.As of early December, CoinTerra’s past due balance was about $1.4 million, but C7 is seeking $5.4 million or more in damages, which includes total cost of services for the duration of the contract and other damages.mg box bitcoin“Upon information and belief, CoinTerra chose to pay C7 less than the amounts due in bad faith,” the allegations read.bitcoin geld ohne staatCoinTerra CEO Ravi Iyengar did not return a call seeking comment in time for publication.bitcoin mining abuse

We’ll update this post once we hear back from him.Power is the biggest cost of providing data center services.C7 said it has been paying more than $12,000 per day just to supply power to CoinTerra.C7’s latest invoice issued to the client was for about $430,000, and about $350,000 of the total was for electricity.The data center provider also claims it has incurred losses by turning down other potential customers to accommodate CoinTerra’s needs.C7 is not the only data center provider CoinTerra uses.bitcoin safest walletCenturyLink Technology Solutions announced in July 2014 a big colocation deal with the bitcoin mining company.ethereum farm miningIyengar told Data Center Knowledge at the time that the deal was for north of 10 megawatts of capacity.bitcoin apexA CenturyLink representative declined to comment, citing confidentiality of the contractual agreement between the two companies.will bitcoin reach 10000

C7 Data Centers Accepts Bitcoin May 29, 2014 C7 Data Centers Accepts Bitcoin and San Jose Earthquakes MLS Team in accepting the digital currency May 28, 2014 04:00 PM Eastern Daylight Time BLUFFDALE, Utah–C7 Data Centers (C7), a leading provider of cloud, advanced IT and data center colocation services, announced today it accepts the digital currency bitcoin.Bitcoin is a peer-to-peer payment system and cryptocurrency, so named because it uses cryptography to control the creation and transfer of money, offering an alternative currency and payment-tracking system.litecoin 2014 chartC7 accepts bitcoins through multiple online services, and will add others as the market options expand.bitcoin casino directoryAs a payment option, bitcoins offer customers benefits such as low inflation risk, low collapse risk due to its virtual global currency, and a safe and inexpensive form of payment.

(OSTK), the Sacramento Kings professional basketball team, the Richard Branson-led aviation company Virgin Galactic, the popular blogging platform WordPress used by some of the biggest media companies in the world (including The New York Times, CNN, Reuters and TechCrunch), Tigerdirect (SYX), a major online retailer for electronic products, and Zynga (ZNGA), the popular mobile gaming company.C7 first became involved in bitcoin with its sponsorship of the soon to be released documentary, “Life on Bitcoin.” Beccy Bingham, Director of Marketing at C7, lived and traveled the world on the digital currency with her husband for 101 days in 2013 while a film crew followed them on their journey.The BBC, Al Jazeera, NPR and the Wall Street Journal have profiled the project.C7 Data Centers CEO Wes Swenson stated, “We are accepting bitcoins as an option for account payment.C7 has received many requests over the last few months to accept bitcoin payments, and is responding to the demand.C7 is also one of the leading data centers to provide and host bitcoin transaction processing.

C7 strives to provide its global customers with world-class service, and the pioneer of cryptocurrency will offer another convenient payment option, as it is all about the customer at C7.” About C7 Data Centers A privately held Utah corporation, C7 Data Centers is the largest colocation provider in the state of Utah.C7 builds and operates state-of-the-art multi-tenant, carrier neutral, high-density data centers using ambient air cooling systems in America’s lowest disaster-risk region.C7 delivers cloud solutions and flexible, customized data storage with personalized managed IT services to both local and global customers, serving clients from small business startups to Fortune 1000 companies.For press relations, contact Jennifer Johnson at 202-841-1171.Fill out my Wufoo form!Bitcoin mining company CoinTerra has put its operations on hold as it awaits a response from its lenders on a restructuring proposal, according to CEO Ravi Iyengar.The company has halted its mining and payouts to customers in the wake of a dispute with C7 Data Centers, which has sued CoinTerra for $1.4 million in unpaid colocation fees, and is seeking $4 million in additional costs and contractual payments.

CoinTerra disputes the allegations and says it has filed a counterclaim against C7.In an interview with Data Center Knowledge, Iyengar said CoinTerra’s fate was now in its lenders’ hands.“The whole operation of the company is waiting on the note holders making a decision,” he said.CoinTerra is in default on its senior notes as a result of the shutoff of its equipment at C7, according to Iyengar.The loan is secured by CoinTerra’s assets, including its Bitcoin mining equipment.As a result, CoinTerra was forced to turn off its mining operations at other data centers, including its presence at CenturyLink Technology Solutions.In July, Iyengar said CoinTerra had contracted for more than 10 megawatts of data center capacity with CenturyLink.A CenturyLink spokeswoman declined to comment on the service provider’s relationship with CoinTerra, citing confidentiality agreements.Iyengar said it has updated its customers on the status of its operations and the default on its debt.CoinTerra has not made payouts to its cloud mining customers since Dec.

“The Note Holders are evaluating their options,” CoinTerra said in its customer notice.“Until this is resolved, CoinTerra will be unable to make further payments.” In its lawsuit, C7 says it provisioned about $12,000 a day in electricity from Rocky Mountain power to support CoinTerra’s cabinets, but that CoinTerra became delinquent “almost immediately” after it began service in April 2014.In a statement, CoinTerra said it has filed a countersuit against C7.disputes the allegations in the complaint filed by C7 Data Centers, Inc.in Utah State court,” the company said.“CoinTerra has recently retained local counsel to address this dispute.Moreover, CoinTerra has filed a counterclaim against C7 in federal court in the District of Utah.CoinTerra intends to vigorously prosecute its claims against C7 while defending the claims levied by C7.Yet, CoinTerra is hopeful that the parties can resolve this matter quickly.” The statement did not specify which of C7’s claims were in dispute.

Iyengar said the company’s comment on the C7 case would be limited to its statement.In assessing his company’s challenges, Iyengar said CoinTerra’s efforts have been undermined by “irrational” mining practices that have made it difficult to earn new bitcoins.The network is designed to adjust its reward system based on the level of activity.As the price of bitcoin rises, the computing power on the network (known as hashrate) should increase.As the price declines, the hashrate should eventually moderate — at least in theory.Iyengar said this has not held true.The price of Bitcoin has been in steady decline since hitting a peak of $1,100 in late 2013, dipping to $225 this week.But as the price has moved lower, the network hashrate has continued to rise, reaching an all-time high of 358 petahashes last week.“Somehow, the self-correcting model (for the bitcoin network) has not performed as expected.” said Iyengar.“The difficulty does not go down, but the price does not rise.