Bitcoin miners could face challenges as the world's largest cryptocurrency by market cap fluctuates within a narrow range and investors begin selling off their holdings. However, stablecoin giant Tether is making a significant investment in one of the sector's key players, acquiring shares of publicly traded cryptocurrency company Bitdeer in April for approximately $32 million.
According to SEC filings, Tether acquired the stock as its value was falling. Tether did not immediately respond to questions from Decrypt , but the company has been increasing its interest in bitcoin mining: It bought a stake in Bitdeer last year, and in March filings it said it had increased its stake in the company to 21%.
The stablecoin company said Monday that it will also support Bitcoin mining pool Ocean by providing it with hashrate to mine blocks and earn BTC rewards.
Nasdaq-traded Bitdeer (BTDR) shares closed at $7.62 per share, down 67% from the start of the year and part of a broader industry downturn caused by declining interest in Bitcoin and a sharp increase in mining difficulty that has made it difficult for miners to cover their costs.
The share price of MARA Holdings, the largest mining company by market capitalization, is down 26% year-to-date, while shares of another major company, Riot Platforms, are down more than 38%.
According to CryptoQuant data, miners have been actively selling bitcoins over the past week, likely to raise funds.
Bitcoin recently traded at around $85,000, up 7% from last week but well below its all-time high of $109,000 set in January.
Tether is the company behind USDT, a digital token that operates on multiple blockchains. USDT is the largest stablecoin and the third-largest cryptocurrency by market capitalization, and is often the most actively traded crypto token by daily volume.
As a stablecoin, it is backed by dollars, Treasuries, and other investments, allowing the cryptocurrency's value to be used as fiat currency — mainly so that traders can conduct trades without involving banks.
However, Tether has faced legal complications. In February 2021, the company agreed to cease operations in New York after a two-year investigation by the state attorney general found that it “made false statements about its support” for its stablecoin.
However, Tether points to quarterly confirmations and transparency reports as proof that its cryptocurrency is indeed backed as claimed. The firm also confirmed to Decrypt that it is working with a Big Four accounting firm to conduct an independent audit.
Edited by James Rubin
Source: cryptonews.net
