Binance Pool launches $500M lending project for BTC mining, seeks cloud mining vendors
10:47, 14 October 2022
The Binance cryptocurrency exchange has launched a $500m loan for bitcoin (BTC) miners after recognising “difficult market conditions”.
This news came as BTC fell close to a three-month low. However, the coin appears to be rebounding, as mining difficulty reaches an all-time high.
A loan for BTC miners
The loan comes from Binance Pool, the exchange’s platform dedicated towards mining services.
These funds will be available to public and private bitcoin miners, including infrastructure companies, as it looks to spur a flourishing market.
The exchange is hoping its $500m loan will benefit this ecosystem. The loans would span between an 18 to 24-month period, with interest rates ranging from 5 to 10%.
Binance also announced it is launching its own cloud mining products, where users can mine cryptocurrencies without their own hardware or software. It is now looking for vendors to help provide this service.
Market fluctuations
Bitcoin has struggled over the past month. Its price dipped to a 90-day low of $18,290.32 on 21 September. BTC has recently came close to this low again on 13 October after falling to $18,319.82.
BTC to USD
But the cryptocurrency has recovered. As of 14 October, it was trading at roughly $19,500 and was up 3% in the previous 24 hours.
Mining difficulty spike
This price rise comes as bitcoin mining difficulty reaches an all-time high.
Difficulty is a measurement of how much computational power it requires to mine a BTC. The more miners on the network, the higher the difficulty is.
Bitcoin difficulty has recently rocketed to a record of 35.61 trials/nonce (t). This is almost 80% higher than its difficulty last year, when it was sitting around the 20t mark, according to YCharts.
This spike in difficulty is not a surprise to the crypto community as there was a large migration of miners last month. Ethereum switched to a proof-of-stake consensus mechanism, evicting miners from their consensus mechanism.
The Bitcoin blockchain is benefitting from this with its mining difficulty seeing an average growth rate of 176%, according to YCharts.
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