Tether, the largest stablecoin issuer in the world, has recently announced its entry into the Bitcoin mining industry. The company said it has partnered with a local licensed company in Uruguay to launch a sustainable Bitcoin mining operation using renewable energy sources. Tether said it aims to diversify its revenue mix and support its USDT stablecoin, which has a circulating supply of more than $83 billion.
According to the Cambridge Bitcoin Electricity Consumption Index, Bitcoin mining consumes about 121 terawatt-hours of electricity per year, more than many countries.
Tether’s New Operation Will be Greener
Tether claims that its Bitcoin mining operation will use renewable energy sources such as solar, wind, and hydropower to minimize its carbon footprint and ecological impact. The company said it has also invested in energy production in Uruguay, which has a high share of renewable energy in its electricity mix. Tether said it is leading the way in sustainable and responsible Bitcoin mining and hopes to inspire other companies to follow suit.
Tether’s chief technology officer Paolo Ardoino said that the company’s investment in Bitcoin mining is part of its treasury management strategy, which also involves buying Bitcoin with up to 15% of its net profit. He said that the company estimates that its excess reserve will increase by $700 million in the current quarter, which is not yet over. He added that Tether is committed to maintaining its 1-to-1 peg with the US dollar and backing its USDT stablecoin with a diversified portfolio of assets.
Tether’s move into Bitcoin mining comes amid increased regulatory scrutiny and legal challenges for the company. Tether has faced allegations of manipulating the crypto market, issuing unbacked tokens, and hiding its reserves. The company has also been fined by regulators in New York and Hong Kong for violating anti-money laundering and disclosure rules. Tether has denied any wrongdoing and said it is cooperating with authorities.
Tether is not the only stablecoin issuer that is venturing into Bitcoin mining. Circle, the issuer of USD Coin (USDC), another popular stablecoin, has also announced plans to launch a Bitcoin mining operation in Texas using renewable energy. Circle said it wants to support the growth and adoption of crypto while reducing its environmental impact.
