Affected by the cryptocurrency market downturn, the mining industry has gotten some major support from Binance. The world’s largest cryptocurrency exchange has set up a $500 million fund to finance cryptocurrency miners for 5-10% interest. A boon for one of the key sectors of the crypto ecosystem.
500 million to boost mining
Cryptocurrency exchange Binance has announced that it has set up a US$500 million fund to support the crypto mining industry. In a statement released last week, Binance makes it known that the decision is motivated by a desire to help maintain a healthy crypto ecosystem.
In light of current market conditions, Binance Pool is launching a $500 million loan project to support cryptomineers and digital infrastructure providers.
press release from Binance
Through this fund, struggling cryptocurrency miners will be able to access secured debt financing. Still, the miner would have to agree to Binance’s terms and conditions. Indeed, the exchange requires, among other things, a loan over 18 to 24 months with an interest of 5% to 10%. In addition, the miner must provide collateral in the form of mining equipment or cryptocurrencies.
Immense economic difficulties for crypto miners
The launch of the mining industry loan fund by Binance comes at a time when cryptocurrency miners are facing significant difficulties. Indeed, since the decline in cryptocurrency prices, miners have seen their economic gain drop sharply.
In addition, the rising cost of energy has not done miners any favors at all. In some countries, regulatory difficulties for crypto miners have also been on the cards.
Several mining giants have seen their operations slowed or even halted.
In the United States, Computh North filed for bankruptcy, protecting itself under Chapter 11 bankruptcy law in order to pay back its 500 million in credits. Marathon Digital and Riot Blockchain, two major mining companies in the world, sold more Bitcoin than they produced last month. The ongoing winter in the cryptocurrency market isn’t likely to help matters.
Mining is a process through which super-powered computers perform verification of cryptocurrency transactions. Those who do this are then paid regularly by the payment of tokens based on the verified blocks. This makes it an important activity in the survival of cryptocurrencies like Bitcoin and Binance, which is a giant in the crypto sector, is well aware of this.
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