Tether Sets Sights on Bitcoin Mining
Tether, a major stablecoin issuer, is planning to invest $500 million in bitcoin mining as part of its strategy to become a prominent player in the industry. The company is currently in the process of establishing mining facilities in South America and Central America, with the goal of contributing one percent of the total computing power of the BTC network.
Tether’s Move into Bitcoin Mining
The company, which dominates the stablecoin market, recently reported a cash surplus of over $3 billion. In an interview with Bloomberg, incoming Tether CEO Paolo Ardoino revealed the plan to allocate $500 million to bitcoin mining activities over the next six months. This fund will be used for constructing Tether’s mining facilities and investing in existing BTC mining businesses, including a $609 million debt financing facility for European bitcoin miner Northern Data Group.
Tether is diversifying into BTC mining to provide an alternative avenue for profit-making, following the rise in market cap of its stablecoin, USDT, which reached a new peak of over $87 billion in November 2023.
Aiming for One Percent Market Share
To establish itself in the bitcoin mining industry, Tether is targeting one percent of the total bitcoin mining computation power, aiming to have facilities in Uruguay, Paraguay, and El Salvador, each with a capacity of 40-70 megawatts. The company also plans to increase its direct mining operations to 120 megawatts by the end of the year, with a goal of reaching 450 megawatts by the end of 2025.
Despite the ambitious efforts, Ardoino stressed that Tether is not rushing to become the world’s largest miner and sees mining as a learning process that will develop over time.
Hot Take: Tether’s Ambitious Bitcoin Mining Strategy
Tether’s move into bitcoin mining is a significant shift for the leading stablecoin issuer. With plans to invest $500 million and contribute one percent of the BTC network’s computing power, Tether is positioning itself as a major player in the industry. Despite the ambitious goals, Tether is taking a measured approach, signaling a long-term commitment to the mining sector.
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