May 31, 2023: Cryptocurrency firm Tether is setting up a bitcoin drilling operation in Uruguay using renewable power as the company looks to diversify the revenue mix to support its USDT stablecoin.
On Tuesday, the firm announced that it intends to invest its resources into a renewable energy show, celebrating its first foray into the energy sector.
It said that Tether is also exploring for “experts in the area” to support its expansion into the renewable energy space. Mining Bitcoin is notoriously power-intensive, depending on a distributed network of computers worldwide to verify that trades are fair and release further coins into circulation.
“By harnessing the power of Bitcoin and Uruguay’s renewable energy capabilities, Tether is leading the way in sustainable and responsible Bitcoin mining,” said Paolo Ardoino, CTO of Tether.
“Our unwavering commitment to renewable energy ensures that every Bitcoin we drill leaves a minimal ecological footprint while upholding the security and integrity of the Bitcoin network.”
This month, Tether said it would shift its treasury control strategy to invest some of its net profit in Bitcoin.
The company is dedicated to using up to 15% of its net profit to purchase Bitcoin, mimicking similar strategies from businesses such as Tesla and MicroStrategy.
Tether issues what is known as a stablecoin. This is a token that, unlike Bitcoin and other cryptocurrencies, is meant to hold a stable value at all times.
USDT is the biggest stablecoin in the market, with a circulating supply of more than $83.2 billion, according to CoinGecko data. It competes with Circle’s USD Coin and Binance’s BUSD.
Traders utilize stablecoins to drive in and out of different cryptocurrencies without converting money back into fiat currencies.
Tether states that each of its USDT tokens in circulation is backed 1-to-1 by an equivalent amount of U.S.-denominated assets held in reserve.
The company has gotten into hot water, as regulators and economists have questioned the integrity of the assets backing its token.
Tether once held most of its assets in commercial paper, a less liquid form of corporate debt. It has more recently replaced all of its commercial paper with U.S. Treasurys.
The U.S. International Trade Administration states that Uruguay is noticed as a leader in renewable energy shows, sourcing over 98% of its electricity work from renewables, especially current and hydropower.
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