Binance has decided to set up a $500 million fund to allow miners in difficulty to take out a loan from the platform for 5 to 10% interest. Indeed, 2022 is a particularly difficult year for Bitcoin (BTC) miners, who are sometimes forced to sell their BTC stock to survive.
Binance releases $500 million for miners
Binancethe world’s largest cryptocurrency exchange, has launched a $500 million fund to support struggling Bitcoin (BTC) miners.
Bitcoin (BTC) mining makes it possible to finalize blocks on the blockchain of the same name. This is an extremely complex calculation method that allows miners to be rewarded for their activity directly in the form of BTC. To learn more, we invite you to watch our explanatory video of Bitcoin mining.
Also, Binance will allow miners who are currently experiencing financial difficulties to get a loan from the platform, with interest ranging from 5 to 10% under conditions not yet detailed. According to the statement, these loans can be spread over a period of 18 to 24 months.
This financial boost will be accessible to private companies, but also to public companies, we can read:
“This project, the first of its kind for Binance Pool, was designed to provide secured debt financing services to blue-chip public and private companies in bitcoin (BTC) mining and infrastructure. digital assets around the world. »
In order to be eligible for one of these loans provided by Binance, minors will however have to provide guarantees with the platform in the form of mining equipment or directly in the form of cryptocurrencies.
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Bitcoin Miner Revenues at Lowest Level
This initiative was put in place as a result of strong difficulties encountered by Bitcoin miners, who are seeing their earnings directly impacted by the falling price of the king of cryptocurrencies, which has been steadily falling since its all-time high (ATH) of $69,044 hit on November 10. The latter is now hovering between $18,000 and $24,000, and that should still last for a while.
Consequently, the miners were able to observe a significant drop in their income, which forced some of them to sell their assets, so much so that the amount of Bitcoins held by miners had not been this low since 2010.
Bitcoin miner monthly earnings from January 2017 to present
These difficulties, combined with the rising cost of energy, led giants such as Computh North to file for bankruptcy. In this specific case, the firm is protected under Chapter 11 of the United States bankruptcy law in order to repay its credits, which reach 500 million dollars.
In the same vein, poolinone of the largest Bitcoin mining pools, had to refuse some of the withdrawals requested in BTC and Ether (ETH) by its customers following a major liquidity problem due to too many simultaneous withdrawals.
Marathon Digital and Riot Blockchain, which are among the largest publicly traded mining companies in the world, sold more Bitcoin than they produced in the last month. This contrasts sharply with its results for the first 4 months of the year, during which they only sold around 30% of their production.
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Sources: Binance press release, IntoTheBlock, The Block Data
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