In a significant development, Tether, the issuer of the widely used stablecoin USDThas acquired a $100 million stake in Bitdeer Technologies Group, a US-listed bitcoin miner owned by Chinese billionaire Jihan Wu.
Notably, the deal includes an option for Tether to purchase an additional $50 million in shares within a year, strengthening its position in the bitcoin mining sector.
Tether's multi-billion dollar stake in Bitdeer
bitcoin-miner-bitdeer” target=”_blank” rel=”noopener nofollow”>According According to Bloomberg, the subscription agreement between Tether and Bitdeer involved a private placement of 18.6 million Class A common shares, generating $100 million in gross proceeds.
Additionally, one order allows Tether to acquire up to five million additional shares at $10 per share. The private placement concluded Thursday, with Cantor Fitzgerald & Co. acting as placement agent.
Bitdeer stated that the funds from the deal will support the expansion of its data center operations, the development of application-specific integrated circuits (ASICs) based crypto mining equipment and other general corporate purposes. However, no details were revealed about the percentage of Bitdeer held by Tether under the deal.
This deal represents a significant step for Tether in its goal of becoming a major player in bitcoin mining. Last year, the company began building its own mining facilities in Uruguay, Paraguay and El Salvador, committing to invest $500 million within six months.
Bitdeer Market Rebound
Singapore-based Bitdeer is among the largest publicly traded crypto miners in the United States, with a market capitalization of approximately 670 million dollars. The company operates data centers in the United States, Norway and Bhutan.
Following news of the deal, Bitdeer shares, which had fallen more than 40% this year, rose about 6.5% to $6.20.
Earlier this year, Bitdeer was reportedly in talks with private lending firms to secure approximately $100 million in financing. It is not yet clear whether these discussions will continue after Tether's capital injection into the company..
bitcoin mining involves running power-hungry computers that secure the blockchain and earn new tokens as rewards. In April, rewards were cut in half as part of a scheduled network update known as “The Halving,” which occurs every four years. This change effectively reduced the profitability of bitcoin mining by approximately half.
In contrast, the btc price hit an all-time high of $73,700 in March, driven by optimism surrounding the launch of bitcoin spot. exchange traded funds (ETF) in the United States. At the time of writing, the largest cryptocurrency is trading at $67,150, a drop of more than 3% in the last 24 hours.
Featured image from Shutterstock, chart from TradingView.com
