November 20, 2023

Tether Ventures Into Bitcoin Mining with a $500 Million Investment, Targets Substantial Market Share Expansion

Tether is set to make a bold move into Bitcoin mining, allocating $500 million for investment and expansion efforts. The goal is to secure 1% control of the Bitcoin network, with Tether planning the establishment of mining facilities on a global scale.

Having solidified its position in the stablecoin market, Tether is now eyeing a strategic entry into the realm of Bitcoin mining with a substantial financial commitment.

Over the past year, Tether has demonstrated a remarkable 32.7% increase in market capitalization, underscoring its influential role in the cryptocurrency landscape.

Incoming CEO Paolo Ardoino has unveiled plans for a nearly $500 million investment over the next six months to propel Tether into the Bitcoin mining sector, according to reports from Bloomberg. The initiative involves the construction of new mining facilities or the acquisition of stakes in existing companies.

In a noteworthy move last November, Tether extended a $610 million credit facility to Bitcoin mining company Northern Data AG, following its acquisition of shares in the same company in September.

This strategic shift not only diversifies Tether’s revenue streams but also introduces a new dynamic to the competition for USDT's limited token supply. Currently, Tether generates income by managing U.S. Treasury bills and other assets within USDT’s $87 billion reserve, accumulating an excess cash reserve of approximately $3.2 billion as of September 30, 2023.

Paolo Ardoino is slated to assume the role of Tether CEO in December 2023 while retaining his position as Chief Technical Officer at the parent company, Bitfinex.

Tether is actively exploring potential locations with a 300-megawatt capacity for profitable mining operations, taking into account the recent 26% surge in bitcoin prices over the past month. The company has also implemented mobile facilities housed within large containers for swift relocation to areas with more cost-effective electricity, as reported by Bloomberg.

Tether is presently establishing Bitcoin mines in Uruguay, Paraguay, and El Salvador, each with a capacity ranging from 40 to 70 megawatts. The company’s ambitious target is to attain 1% of the total computing power on the Bitcoin network, as opposed to Marathon Digital's 4%.

By the end of 2023, Tether aims to achieve 120 megawatts across its direct mining operations, with a forecasted increase to 450 megawatts by 2025. Approximately $150 million has been earmarked for investments in mining opportunities where Tether plays an active role.

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