Tether Plans to Expand into Bitcoin Mining Industry

Tether Holdings Ltd., the entity behind the $87 billion USDT stablecoin, is venturing into Bitcoin mining, a move that represents a significant shift from its core business. 

Paolo Ardoino, the incoming CEO, revealed plans to invest approximately $500 million in the next six months. 

This investment includes constructing their own mining facilities and acquiring stakes in other companies. Notably, part of this investment is a $610 million credit facility extended to Northern Data AG, a Bitcoin mining firm, earlier this month.

This move signifies Tether's commitment to becoming a significant player in the Bitcoin mining ecosystem. 

Ardoino emphasized the seriousness with which they are approaching this expansion, including building new substations and sites. 

The entrance of Tether into Bitcoin mining could significantly impact the competition for Bitcoin's limited supply and diversify Tether's revenue sources.

Currently, Tether profits from managing a large reserve of U.S. Treasury bills and other assets backing the USDT stablecoin. 

Jaran Mellerud, the CEO of MinerMetrics, a company specializing in data and research for Bitcoin mining, remarked:

“Being a private company that generates enormous amounts of cash even in the bear market, Tether is uniquely positioned to make massive anti-cyclical investments.”

They have already invested over $800 million this year in various research-related fields, including Bitcoin. 

The company plans to establish Bitcoin mining facilities in Uruguay, Paraguay, and El Salvador, aiming to achieve a 1% share of the total computing power on the Bitcoin network, which would rank it among the world's top 20 Bitcoin mining companies.

By the end of 2023, Tether aims to reach 120 megawatts in its direct mining operations, with a long-term goal of 450 megawatts by 2025. 

About $150 million is allocated for direct involvement in mining opportunities, reflecting Tether's potential influence in the industry.