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-million dollar stake in Bitdeer
According to According to Bloomberg, the underwriting agreement between Tether and Bitdeer involved a private placement of 18.6 million shares of Class A common stock, generating $100 million in gross proceeds.
Additionally, a warrant allows Tether to acquire up to five million additional shares at $10 per share. The private placement closed Thursday, with Cantor Fitzgerald & Co. acting as placement agent.
Bitdeer said funds from the deal will support the expansion of its data center operations, development of application-specific integrated circuits (ASICs) based on crypto mining equipment and other general business purposes. However, details regarding the percentage of Bitdeer owned by Tether as part of the deal were not disclosed.
This agreement represents an important step for Tether in its goal to become a major player in Bitcoin mining. Last year, the company began building its own mining facilities in Uruguay, Paraguay and El Salvador, pledging to invest $500 million within six months.
Bitdeer market rebound
Bitdeer, headquartered in Singapore, is among the largest publicly traded crypto miners in the United States, with a market capitalization approximately $670 million. The company operates data centers in the United States, Norway and Bhutan.
Following the deal’s announcement, 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 companies to secure around $100 million in financing. Whether these discussions will continue after the Tether announcement capital injection entry into the company remains unclear.
Bitcoin mining involves running power-hungry computers that secure the blockchain and earn new tokens as rewards. In April, the rewards were cut in half as part of a scheduled network upgrade known as “The Halving,” which occurs every four years. This change effectively reduced the profitability of Bitcoin mining by about half.
In contrast, the price of BTC reached an all-time high of $73,700 in March, driven by optimism surrounding the launch of spot Bitcoin. exchange traded funds (ETF) in the United States. At the time of writing, the largest cryptocurrency is trading at $67,150, down more than 3% in the past 24 hours.
Featured image from Shutterstock, chart from TradingView.com
