Binance Announces $500 Million Funding for Bitcoin Mining
Binance Pool, the crypto mining services arm of cryptocurrency exchange Binance, aims to support Bitcoin miners to weather the crypto winter with a $500 million loan.
The ongoing bear market has had deep impacts on almost all industry participants, particularly miners. Amid rising fuel and electricity prices and the crypto market downturn, this cohort has been hit the most, with many miners proceeding to shut down their machines as profitability becomes negligible.
In a bid to help miners and in turn, help the broader crypto market from further damage, Binance Pool, one of the world’s largest crypto mining pools, has decided to offer a $500 million loan to support Bitcoin miners, the company said in a Friday blog post.
“Binance Pool has a responsibility to help maintain a healthy digital asset ecosystem,” the post read. “In light of current market conditions, Binance Pool is launching a $500million lending project to support crypto miners and digital infrastructure providers.”
The report detailed that both “public and private blue-chip bitcoin (BTC) mining and digital asset infrastructure companies globally” would be able to secure debt through this initiative and finance their services.
Some terms of the loans include “an 18 to a 24-month term,” interest rates ranging from 5% to 10, and “offering security, either physical or digital assets, satisfactory to Binance.”
Aside from Binance, other major industry players have also taken measures to support struggling crypto miners. For one, Jihan Wu, the founder of crypto mining rig-maker Bitmain, plans to set up a $250 million fund to purchase distressed assets from mining firms.
“There are opportunities in every cycle,” Matt Kong, chief executive officer of Bitdeer, reportedly said. “If you can time the market and enter at the bottom, come out at the top, then you will make money. It works especially well for mining.”
Bitcoin Hashrate Hits New ATH
On Tuesday, the total hashrate of the Bitcoin network reached a fresh all-time high, suggesting that miners are now more optimistic about the bitcoin price as they have become online despite consistently low BTC prices.
The Bitcoin hashrate is a measure of the amount of computing power that is dedicated to mining BTC and securing the network. An increasing hashrate means that more mining machines are coming online, which could signal rising optimism among miners about bitcoin prices going forward.
Data from Blockchain.com shows that the total Bitcoin hashrate hit 241.88 Ehash/s last week, up significantly from this year’s low of 168.2 Ehash/s in early January. The all-time high was reached when looking at the data on a 7-day moving average basis, an often-used way to smooth out shorter-term fluctuations in the hashrate on the Bitcoin network.