Binance launched a $500,000,000 fund to lend to Bitcoin miners. Announcing this initiative comes at a time when Bitcoin miners are struggling to cope with the effects of Crypto Winter, at the moment.
Binance has launched a fund of $500 million to lend to Bitcoin miners who are struggling to deal with the difficult crypto-market conditions.
Binance Pool, the company’s mining service, will offer loans to both public and private Bitcoin miners. They will need to pledge security in the form of physical or digital assets to be eligible for loans that last 18-24 months. Interest rates at Binance will range from 5% to 10%.
This initiative comes after Bitcoin miners faced a difficult few months, as the bitcoin price fell.
Due to low bitcoin prices, miners’ revenue has declined sharply. Compute North even filed bankruptcy.
The revenue of Bitcoin miners fell 16.2% last month to \$550.5m. This was the fifth consecutive decline and the lowest since November 2020 according to data from The Block Research.
Binance isn’t the only company that wants to support crypto-mining. Jihan Wu, a Chinese crypto billionaire, created Bitmain last month to purchase distressed assets from Bitcoin miners. Wu’s Bitdeer Technologies Holding Co. will invest $50 million of its money. Wu will then seek to raise $200 million from outside investors.
Last month, DeFi platform Maple Finance opened a $300 million lending pool to Bitcoin miners. The platform will offer loans with a 12–18 month term and charge interest rates between 15%-20%.
Grayscale , a crypto asset manager, created a new entity called Grayscale Digital Infrastructure Opportunities LLC earlier this month to invest in Bitcoin mining hardware. The entity intends to buy mining rigs, and to make a profit selling the bitcoins it has earned.
