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 make it through the crypto winter with a $500 million loan.
The ongoing bear market has had a profound impact on almost all industry participants, especially miners. Amid rising fuel and electricity prices and the downturn in the crypto market, this group has been hit the hardest, with many miners continuing to shut down their machines as profitability dwindles.
In an effort 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 posts.
“Binance Pool has a responsibility to help maintain a healthy ecosystem for digital assets,” the post read. “In light of current market conditions, Binance Pool is launching a $500 million loan project to support crypto miners and digital infrastructure providers.”
The report described 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 collateral, either physical or digital assets, satisfactory to Binance.”
Aside from Binance, other major industry players have also taken steps to support struggling crypto miners. First, Jihan Wu, the founder of crypto mining rig maker Bitmain, plans to create a $250 million fund to buy distressed assets from mining companies.
“There are opportunities in every cycle,” Bitdeer CEO Matt Kong reportedly said. “If you can time the market and go in 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 new all-time high, suggesting that miners are now more optimistic about the bitcoin price as they have come online despite consistently low BTC prices.
The Bitcoin hashrate is a measure of the amount of computing power dedicated to mining BTC and securing the network. An increasing hashrate means more mining machines are coming online, which could signal growing optimism among miners about bitcoin prices going forward.
Data from Blockchain.com shows that the total Bitcoin hash rate reached 241.88 Ehash/s last week, a significant increase from the 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, a commonly used way of smoothing out short-term fluctuations in the hashrate of the Bitcoin network.
