To support the ailing Bitcoin mining economy, Binance seeks to offer debt financing services to participants in the sector.
Binance to the Rescue
Binance Pool, an arm of leading cryptocurrency exchange Binance, announced the launch of a $500 million lending pool for Bitcoin miners.
According to an Oct. 14 blog post, the lending pool was established “to provide secure debt financing services to both public and private blue-chip bitcoin (BTC) mining and digital asset infrastructure companies globally.”
Under the program, borrowers deemed eligible will have access to loans with interest rates ranging from 5% to 10% on an 18- to 24-month term.
In addition to the lending pool, Binance Pool confirmed that it intends to launch cloud mining products. According to it, “the cloud mining hash power will be directly purchased from bitcoin mining and digital infrastructure providers.”
Hard Times for Miners
The $500 million lending pool comes at a time when participants in the Bitcoin mining industry are struggling to make a profit, due to falling crypto prices and surging electricity costs. The last few months have been marked by a series of events ranging from mining companies declaring bankruptcy to some ceasing to operate.
For example, on Sept. 1, Bitcoin (BTC) mining rig service Compass Mining confirmed that the owners of two of its mining hubs in Georgia shut down operations due to a “50% spike in the price of electricity.”
And CoinDesk reported that Compute North, a leading data center provider for cryptocurrency miners and blockchain companies, filed for Chapter 11 in U.S. Bankruptcy Court on Sept. 22, due to trouble with lenders and the severity of the crypto bear market.
What Is Binance:
Binance positions itself as the world’s leading blockchain ecosystem and crypto-asset infrastructure provider with a financial product suite that includes the largest digital asset exchange by volume. The Binance platform aims to increase the freedom of money for users and features a comprehensive portfolio of crypto-asset products and offerings, including trading and finance, education, data and research, social good, investment and incubation, decentralization, and infrastructure solutions.
Where to find Binance:
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