Tether, the company behind the largest and most popular stablecoin, Tether (USDT), has unveiled plans to expand into Bitcoin mining, according to its soon-to-be CEO, Paolo Ardoino. The company intends to spend around $500 million on the large-scale expansion over the following six-month period.

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Tether’s Plans for Entering the Bitcoin Mining Sector

According to Ardoino, who is expected to take on the CEO role in December while also keeping his position as Bitfinex’s CTO, the funds will primarily go to the construction of mining facilities and investments in other miners.

Tether intends to build mining facilities in several locations, including Paraguay, Uruguay, and El Salvador.

https://twitter.com/paoloardoino/status/1723766170120073640

One of its significant goals regarding the initiative is to reach 1% of all computing power used to mine Bitcoin, and its upcoming sites will have a capacity of anywhere between 40 and 70 megawatts.

The gargantuan investment isn’t the only Bitcoin-related venture that Tether has sought out recently. It decided earlier this year to use 15% of its realized profits to start buying Bitcoin.

According to estimates, the company has purchased about 55,000 BTC as of August 1, 2023. In its Q1 2023 Assurance Report, the company said it has $1.5 billion in BTC.

In other words, Tether is making major moves that would allow it to step away from being “just a stablecoin issuer” and diversify its business plan.

Whether or not this course of action will impact USDT, its popularity, and usage, and if so — how big of an effect remains to be seen.

While the company might spend up to $500 million on this venture, the mining investment will include at least a part of the $610 million debt financing facility extended to German mining firm Northern Data Group, which Tether revealed in early November.

Tether will Soon Outgrow its Goal of 1% Market Share

Tether and Ardoino know they are new to the mining scene, and the company’s upcoming CEO admitted as much. “Mining for us is something we must learn and grow over time. We are not in a rush to become the biggest miner in the world,” he noted.

However, according to the CEO of Bitcoin mining data and research firm MinerMetrics, Jaran Mellerud,

A 1% market share would likely make Tether among the world’s 20 largest Bitcoin mining companies.

Mellerud added that Tether is an essential entity in the crypto ecosystem thanks to the USDT stablecoin, the world’s largest stablecoin by market cap. MinerMetrics’ CEO expects that, with this in mind, it is more than likely that Tether will grow its market share far beyond this initial 1% goal.