- A $500 million fund has been established by Binance to offer Bitcoin miners loans.
- The initiative comes at a time when it’s hard for Bitcoin miners to deal with Crypto Winter.
A $500 million fund has been established by Binance to offer loans to Bitcoin miners who are having trouble coping with the challenging crypto-market conditions.
The mining service of the company, Binance Pool, will offer loans to privately and publicly listed Bitcoin miners. To get loans with terms ranging from 18 to 24 months, miners will need to pledge security in the form of physical or digital assets.Interest rates on Binance’s loans will range from 5% to 10%.
The initiative comes at a time when the price of bitcoin dropped and Bitcoin miners had a rough few months. Miners’ profits have plummeted significantly as a result of low bitcoin prices; Compute North even declared bankruptcy.
According to data from The Block Research, Bitcoin miners’ revenue decreased by 16.2% last month to approximately $550.5 million. This was the lowest total since November 2020 and the fifth decline in the previous six months.
It’s not just Binance that wants to help the crypto-mining industry. Bitmain founder Jihan Wu, a Chinese crypto billionaire, established a $250 million fund to acquire distressed assets from Bitcoin miners last month. Wu’s Bitdeer Technologies Holding Co. intends to put in $50 million of its own money, and Wu wants to raise another $200 million from outside investors.
A $300 million lending pool for Bitcoin miners was also launched by DeFi platform Maple Finance last month. The platform will offer loans with terms of 12 to 18 months and interest rates of around 15% to 20%.
To make investments in Bitcoin mining hardware, crypto asset manager Grayscale established Grayscale Digital Infrastructure Opportunities LLC earlier this month. The company intends to acquire mining rigs and hopes to make money by selling the earned bitcoins.
