Tether, the company behind the largest stablecoin USDT, has announced its intention to invest $500 million in green Bitcoin mining over the next six months. The move is part of Tether’s strategy to diversify its revenue sources and reduce its reliance on the USDT token, which faces regulatory scrutiny and reputational challenges.
The investment will focus on building sustainable and environmentally friendly mining operations in various locations, including Uruguay, Paraguay, and El Salvador. The company aims to achieve about 1% of the Bitcoin network’s hashrate, which measures the computing power dedicated to securing the network and processing transactions.
One of the projects that Tether is backing is Volcano Energy, a renewable energy initiative in El Salvador that plans to use solar and wind power to generate electricity for Bitcoin mining. Volcano Energy is expected to create one of the world’s largest Bitcoin mining farms, with a capacity of 241 MW and a computation power of more than 1.3 EH/s. Tether is among the initial investors in the project, which has a total budget of $1 billion.
The chief technology officer Paolo Ardoino said that Volcano Energy represents one of the most groundbreaking and strategic initiatives that the company is investing in. He added that Tether is looking forward to working with Volcano Energy’s CEO Josue Lopez and his team to make El Salvador a global force in renewable energy production.
Tether’s expansion into Bitcoin mining comes at a time when the industry is facing increased attention and criticism over its energy consumption and environmental impact. According to Lopez, more than 52% of Bitcoin mining is currently done sustainably, and he expects this percentage to rise significantly in the coming years through investments like Volcano Energy’s.
The investment in Bitcoin mining could also improve the decentralization and resiliency of the network, as well as the geographic distribution of mining power. However, some observers have expressed concerns about the potential concentration of mining power in the hands of Tether and its affiliates.