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Tether Has An Ambitious Plan To Dive Into Bitcoin Mining

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  • Tether plans a $500 million Bitcoin mining expansion in the next six months.
  • The stablecoin giant aims to secure 1% of the Bitcoin mining network’s computing power.
  • Tether’s move signals a major shift from its primary business and could reshape the crypto mining industry.

Tether, the giant in the stablecoin realm with an impressive $87 billion in circulation, is making a seismic shift towards the world of Bitcoin mining.

Paolo Ardoino, poised to assume the reins at Tether, has revealed a bold plan to channel approximately $500 million into a strategic expansion within the Bitcoin mining sector over the next six months.

Tether’s Grand Ascent into Bitcoin Mining

In a recent interview with Bloomberg, Paolo Ardoino shed light on Tether’s ambitious foray into Bitcoin mining, outlining a multifaceted strategy.

The forthcoming investment encompasses not only the construction of new mining facilities but also the acquisition of stakes in existing mining entities, amplifying Tether’s presence and influence in the sector.

This substantial financial commitment is bolstered by a $610 million credit facility, previously extended by Tether to publicly-traded Bitcoin mining company Northern Data AG, following Tether’s acquisition of shares in the Frankfurt-based firm back in September.

Ardoino emphasized Tether’s unwavering commitment to its newfound venture, stating, “We are committed to being part of the Bitcoin mining ecosystem.

When it comes to the expansions, building new substations and new sites, we are taking them extremely seriously.”

This strategic pivot marks a significant departure from Tether’s primary business of managing the USDT stablecoin, which strives to maintain a one-to-one value pegged to the US dollar through a reserve primarily composed of cash and cash-equivalent assets.

Tether boasts an impressive financial arsenal, with profits derived from its management of US Treasury bills and other assets within the $87 billion USDT reserve. As of September 30th, the company had amassed approximately $3.2 billion in excess cash.

Tether has already harnessed a portion of these profits to allocate over $800 million throughout the year for various research-related endeavors, including substantial investments in the world of Bitcoin.

To realize its ambitious mining goals, Tether is laying the groundwork for mining facilities in Uruguay, Paraguay, and El Salvador.

Each of these sites is projected to have a formidable capacity ranging between 40 and 70 megawatts, a testament to the scale of Tether’s ambitions.

The Path to Dominance

Tether’s objective is nothing short of extraordinary – to command 1% of the total computing power driving the Bitcoin network.

Read Also: Tether Mints New $4 Billion Worth of USDT

While Ardoino refrained from specifying a precise timeline for this goal, achieving it would place Tether among the world’s top 20 Bitcoin mining companies.

Jaran Mellerud, CEO of MinerMetrics, remarked, “A 1% market share would likely make Tether among the world’s 20 largest Bitcoin mining companies.

Given Tether’s importance in the crypto ecosystem and its financial muscle, its market share over time will likely grow far beyond its initial 1% goal.”

Tether anticipates reaching an impressive 120 megawatts across its proprietary mining operations by the end of 2023, with an even more ambitious projection of scaling up to 450 megawatts by the close of 2025.

The company has allocated around $150 million to be invested directly in mining opportunities, some of which is earmarked for deployment in new mining sites.

In contrast, Tether’s substantial war chest positions it uniquely to make counter-cyclical investments, buoyed by its private status and ability to generate substantial cash reserves even during bear markets.

Nonetheless, Tether faces its share of challenges, including intensifying competition and the imminent Bitcoin code update known as the halving, which threatens to significantly reduce mining revenue in the coming year.

Mining difficulty, a critical metric that gauges the total computing power required to earn new Bitcoin tokens, has repeatedly soared to historic highs in recent times.

Tether, however, remains resilient and adaptable, evaluating potential sites with 300-megawatt capacity while keeping profitability intact thanks to Bitcoin’s resurgent price trajectory.

In a world where Tether’s dominance is increasingly felt, Ardoino remains pragmatic, emphasizing that “Mining for us is something that we have to learn and grow over time. We are not in a rush to become the biggest miner in the world.”

Disclaimer: The information provided is not trading advice. Bitcoinworld.co.in holds no liability for any investments made based on the information provided on this page. We strongly recommend independent research and/or consultation with a qualified professional before making any investment decisions.



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Cryptocurrency Market Update: Bitcoin Slips Below $70,000 Amidst High Liquidation

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In a swift turn of events, Bitcoin (BTC), the pioneering cryptocurrency, dropped below the $70,000 threshold early on Wednesday following a wave of investor sell-offs. Just a day prior, Bitcoin had crossed the $71,000 mark, but market sentiment swiftly shifted, dragging other major altcoins—including Ethereum (ETH), Dogecoin (DOGE), Ripple (XRP), Solana (SOL), and Litecoin (LTC)—into the red zone.

According to CoinMarketCap data, the overall Market Fear & Greed Index stood at 75 (Greed) out of 100, indicating a mix of optimism and apprehension among traders. Notably, the Bittensor (TAO) token emerged as the top gainer with a remarkable 24-hour surge of over 7 percent, while dogwifhat (WIF) experienced the largest loss, plummeting nearly 16 percent.

Bitcoin (BTC) Price Update Bitcoin’s price tumbled to $69,089.01, marking a 24-hour dip of 3.05 percent, as reported by CoinMarketCap. On the Indian exchange WazirX, BTC was priced at Rs 60.93 lakh.

Other Major Cryptocurrencies Ethereum (ETH) saw a 24-hour loss of 4.81 percent, trading at $3,508.86, while Dogecoin (DOGE) registered a dip of 5.59 percent, currently priced at $0.1879. Litecoin (LTC) and Ripple (XRP) also experienced losses, with Solana (SOL) marking a 24-hour loss of 3.44 percent.

Top Gainers and Losers Bittensor (TAO) led the pack of gainers with a 7.30 percent surge, while dogwifhat (WIF) suffered the most significant loss, dropping by 15.58 percent.

Market Analysis and Expert Insights Experts weighed in on the market scenario, attributing Bitcoin’s downturn to heightened liquidations and cautious sentiment ahead of the upcoming US CPI data release. While Bitcoin’s immediate support rests at $67,700, resistance is expected at $70,400. Ethereum proponents face challenges amid hopes for an ETF approval, with the SEC providing limited updates on the matter.

Final Thoughts The cryptocurrency market remains highly dynamic, with prices fluctuating rapidly and investor sentiment playing a pivotal role. As the market navigates through volatility, it’s essential for investors to stay informed, exercise caution, and seek expert advice before making any investment decisions.

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Cryptocurrency: A Scapegoat for Foreign Policy Failures?

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Cryptocurrency has once again found itself at the center of a heated debate, this time regarding its alleged role in facilitating illicit activities and circumventing sanctions imposed by the United States. The Biden administration, in particular, has come under scrutiny for its handling of the issue, with some accusing it of using digital assets as a convenient scapegoat for broader foreign policy shortcomings.

In a recent hearing before the Senate Banking Committee, Deputy Treasury Secretary Wally Adeyemo raised concerns about the misuse of cryptocurrencies by foreign adversaries such as Iran, Russia, North Korea, and militant groups like Hamas. Adeyemo’s remarks underscored a growing unease within the U.S. government regarding the potential national security implications of unregulated digital currencies.

However, voices from within the cryptocurrency industry and Congress have pushed back against the administration’s narrative. Faryar Shirzad, Chief Policy Officer at Coinbase, one of the leading cryptocurrency exchanges, pointed out that the prevalence of illicit activity in the crypto space is relatively low compared to traditional finance. Instead of demonizing cryptocurrencies, Shirzad argued, the focus should be on targeting bad actors operating offshore.

Senator Tim Scott, the ranking Republican on the Senate Banking Committee, echoed these sentiments, accusing the Biden administration of using digital assets as a distraction from its failure to effectively combat financial flows to sanctioned entities. Scott’s criticism reflects broader skepticism among some lawmakers about the government’s approach to regulating cryptocurrencies.

One area of potential agreement between the Biden administration and the cryptocurrency industry is the need for clearer regulations governing stablecoins, a type of digital asset pegged to a fiat currency like the U.S. dollar. Both sides recognize the importance of addressing the potential risks associated with stablecoin issuance and usage, particularly in the context of national security and financial stability.

The debate over stablecoins has intensified following reports of their alleged role in facilitating illicit transactions, including those linked to Russia’s war effort in Ukraine. The Treasury Department has called for increased oversight of stablecoin issuers and transactions, while also advocating for legislation that would subject them to stricter regulatory standards.

Despite the contentious nature of the discussion, there are signs of bipartisan cooperation on certain aspects of cryptocurrency regulation. A bipartisan bill addressing stablecoin regulation passed the House Financial Services Committee last year, signaling a potential path forward for legislative action in this area.

As the debate over cryptocurrency regulation continues to unfold, it is clear that finding the right balance between innovation and security will be paramount. While concerns about illicit activity and national security must be addressed, policymakers must also recognize the potential benefits of cryptocurrencies in fostering financial inclusion and technological advancement.

Ultimately, the resolution of these issues will require thoughtful collaboration between government officials, industry stakeholders, and lawmakers to develop a regulatory framework that promotes innovation while safeguarding against misuse. Only through constructive dialogue and cooperation can we ensure that cryptocurrencies fulfill their potential as a force for positive change in the global economy.

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Bitcoin Resurgence: Why Wall Street Is Embracing the Crypto Revolution

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Andrew Pratt of Wiser Wealth Management in Marietta, Ga., finds little resistance as he proposes Bitcoin investments to his firm’s committee. With Bitcoin surging 140% in the past year and backed by giants like BlackRock, skepticism has waned. Pratt sees the potential to allocate a modest 1% of client portfolios to Bitcoin, acknowledging the limited downside risk compared to potential gains.

The debate over Bitcoin’s intrinsic value seems to have lost its relevance amidst its soaring market performance. Once dismissed, Bitcoin now boasts a market value of $1.3 trillion, driving the total crypto market to $2.5 trillion. Wall Street, once wary, now views cryptocurrency as an opportunity for profit rather than a speculative venture.

Despite lingering doubts about Bitcoin’s utility beyond speculation, Wall Street executives are increasingly supportive. BlackRock’s CEO, Larry Fink, notably reversed his stance, endorsing Bitcoin’s long-term prospects and championing the iShares Bitcoin Trust, now one of the largest Bitcoin ETFs with nearly $18 billion in assets.

While skepticism persists about Bitcoin’s status as a real asset or currency, its growing acceptance on Wall Street underscores the evolving landscape of finance. As institutions embrace cryptocurrencies, Bitcoin’s journey from pariah to portfolio asset highlights the transformative power of digital assets in reshaping traditional investment strategies.

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