BTC Security

Poolin Collapses: How One of Bitcoin's Biggest Mining Pools Left 11,700 Users Holding Frozen IOUs

2026-07-25

On July 22, 2026, Singapore-based Poolin Technology filed for Chapter 11 bankruptcy in New Jersey court. That's the formal end to what was already a spectacular collapse in the Bitcoin mining world. Founded in November 2017 by Zhibiao "Kevin" Pan, Fa Zhu, and Tianzhao Li, the company was literally the world's largest Bitcoin mining pool in 2019. Now it ranks 17th by hashrate and holds about 0.2% market share. The fall from grace is not subtle.

The bankruptcy covers Poolin and two U.S. affiliates, Lonestar Dream and Lonestar Taproot. The filing lists liabilities between $100 million and $500 million, with prepetition obligations around $173.1 million. But here's the real pain point: 11,700 wallet holders are sitting on $163.7 million in frozen IOUs. That's the biggest single debt on the books, and it didn't happen by accident.

In September 2022, Poolin froze withdrawals for Poolin Wallet and Pool Account users. The reason given was "liquidity issues" tied to withdrawal pressure during that year's broader crypto crash. Reasonable enough on the surface. Except the company never actually restored those funds. Instead, Poolin issued IOU tokens as placeholders for real Bitcoin. Those debts never got repaid. Approximately $163.7 million in IOUs, held by around 11,700 customers, bought the company time but solved nothing.

The wider context makes sense of the desperation. Poolin got hammered by China's 2021 mining ban, the 2022 market downturn, and rising energy costs. The company made a big bet on the United States. After reviewing more than 30 locations, it chose Pyote and Tarbush in Texas in 2021. Early discussions suggested these projects could eventually hit 600 megawatts of electricity. Reality delivered about 100 MW initially. The Texas units piled up roughly $45.9 million in losses since opening, plus another $8.8 million from selling equipment at discounted prices between fiscal 2023 and 2025. That's not a slow leak. That's haemorrhaging.

Mining operations at both Texas locations stopped on July 10. Now the company is liquidating what's left. Thor CALAP LLC will serve as the stalking horse bidder, valuing the portfolio at $52 million: $15 million for the Pyote property with power rights and equipment, and $37 million for the Tarbush site's power rights and equipment. Poolin spent months marketing these assets—contacted more than 335 potential buyers across mining, AI, high-performance computing, private equity and real estate. They got 28 confidentiality agreements, seven letters of intent, and three other indications of interest. Still, the bid deadline sits at September 8 for a court-supervised auction.

Here's the cruel part. The $52 million covers only the physical infrastructure. It doesn't touch the frozen wallet balances. For the 11,700 IOU holders, recovery now depends almost entirely on what the Texas auction actually brings in. They've been waiting more than three years since withdrawals were first frozen. The assets remain subject to higher offers and bankruptcy court approval, but the gap between what's owed and what might be recovered is enormous.

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