- Bitcoin mining company Bitdeer’s chairman Jihan Wu is launching a lending fund of up to $250 million for “distressed” mining companies.
- The decline in bitcoin prices, coupled with factors like rising energy prices has slimmed margins for these companies.
Jihan Wu, chairman of bitcoin mining company Bitdeer, is launching an investment fund for bitcoin miners, Bloomberg has reported.
The fund will have an initial $50 million investment from Bitdeer itself as part of a junior tranche, with Wu then seeking to raise an additional $200 from venture capital firms and other mining companies.
Bitcoin miners have struggled in the past few months with the decline of bitcoin’s price, coupled with other factors like a rise in global energy prices.
Last Thursday, bitcoin mining hosting provider Compute North filed for Chapter 11 bankruptcy, stating in a document that “after any administrative expenses are paid, no funds will be available for distribution to unsecured creditors.”
Compute North also claimed between $100 million-$500 million both in estimated liabilities and estimated assets, according to the initial bankruptcy filing.
Last week, Icebreaker Finance announced another lending fund for bitcoin miners ($300 million in capacity), targeting companies that have been able to keep “effective treasury management and prudent power strategies.”
“Recent market headwinds have caused lenders to pull back, while traditional financing vehicles have been slower to engage this sector,” said Sidney Powell, CEO and co-founder of Maple Finance.
Wu previously co-founded bitcoin mining manufacturer Bitmain and stepped down from the company in early 2021.
The firm has been aiming to go public since last year when it announced a $4 billion SPAC deal with blank-check firm Blue Safari Group Acquisition Corp. The deadline for the deal has been delayed three months from September 14 to December 14, according to a U.S. Securities and Exchange Commission filing from this month.
This article was originally published on theblock.co