That’s why Tether is investing 500 million dollars in Bitcoin mining

Tether, the company behind the $87 billion USDT stablecoin, has announced its foray into bitcoin mining.

With an investment of nearly $500 million over the next six months, Tether is poised to become a key player in this energy-intensive and competitive field.

Binning puts you into bitcoin mining.

Tether's strategy involves building its own mining facilities and acquiring stakes in existing Bitcoin mining companies. This move includes a significant portion of the $610 million credit facility extended to Northern Data AG. Next, Tether demonstrates its commitment to the sector.

“We are committed to being part of the Bitcoin mining ecosystem. When it comes to expansions, building new distribution stations and new sites, we are taking them very seriously. For us, mining is something we have to learn and grow over time. We are not in a rush to become the biggest miner in the world,” he said. Tether CEO Paolo Arduino said.

Tether, primarily known for managing the USDT stablecoin, is unveiling its business model. This expansion into mining could impact the already saturated market for Bitcoin's limited supply. Thus marking a new direction for Tether's revenue streams.

Bitcoin mining, the process of verifying transactions on the blockchain, uses special tools to protect the network and in return receive new BTC tokens. It requires a lot of energy and resources. In fact, Bitcoin's energy consumption is said to be around 127 terawatt-hours (TWh) per year.

In the United States, crypto operations are estimated to contribute to a carbon footprint of 25 to 50 million tons of CO2 annually. These emissions are comparable to the amount produced annually by diesel fuel consumption in the US railroad sector.

Tether has chosen Uruguay, Paraguay and El Salvador for its mining operations. The capacity of each site is 40 to 70 megawatts, achieving a share of 1% of the total network computing power. However, the competitive nature of the crypto mining industry and the upcoming Bitcoin halving are challenges for Tether's new venture.

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Tether's entry into this sector comes as many miners are struggling, indicating the potential for changing market dynamics. The company plans to reach 120 MW by the end of 2023 and up to 450 MW by 2025.