Bitmain, Antpool Offer Bitcoin Mining Industry Lifeline Amid Miner Capitulation
- Bitmain and its mining pool are partnering with Antalpha to provide financial support to the bitcoin mining industry.
- Loans will be low-cost and can be used to pay back equipment loans or to subsidize energy costs.
- Bitmain and Antpool will provide proprietary data to the lender in order to evaluate risk.
Bitmain Technologies Ltd., one of the largest bitcoin mining rig manufacturers based in China, and Antpool are offering a lifeline for bitcoin mining companies during the market downtrend, per a report from Bloomberg.
Antpool is the mining spinoff of Bitmain and also the second largest mining pool in the world. Both Bitmain and Antpool will provide proprietary data to Antalpha, an industry financier, which will allow Antalpha the data necessary to determine and evaluate financial risk to companies requiring low-interest loans to pay back equipment loans and reduce borrowing costs.
Additionally, Antalpha offers a revolving line of credit for bitcoin miners that is strictly only accessible for electricity costs. The low-end of these loans is 6.6%, which is reportedly almost half of the industry standard, while the high end caps out at 8.8%, according to Max Liao, managing director of business development at Antalpha.
“We are taking their biggest cash outflows, electricity cost, and helping them to reduce that burden,” Liao explained to Bloomberg. “We all assume that this bear market is going to end sometime, and we just have to make sure everybody makes it through the winter.”
Indeed, winter has come in full-swing as miners such as Core Scientific and Bitfarms have capitulated under the pressures of loss. Even more so, lenders and even exchanges have succumbed to liquidity crises which heightened fear in the broader ecosystem.
However, in order to alleviate the pressures of current market conditions, Antalpha said it will not require margin-calls on some of its loans by allowing mining rigs to be held as collateral, and that it would allow bitcoin miners to defer payments if needed.
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