USDT Tether Stablecoin Publisher Investments IDR 6.4 Trillion For AI Chips And Bitcoin Mining

Tether disbursed funds for AI-based chip development. (Photo; Doc. Coinsfr)

The leading stablecoin company, Tether, has announced an investment of US$420 million (Rp6.4 trillion) for the artificial intelligence (AI) chip industry and Bitcoin crypto mining. Although not officially announced by Tether, this news has been confirmed by Northern Data executives, companies involved in this deal.

According to a report from Forbes, Tether has disbursed $420 million to purchase 100,000 Nvidia H100 GPU units, which is about 2% of the total 550,000 Nvidia GPU units to be delivered this year.

The purchase was made in the name of Northern Data, a German crypto mining company planning to lease cloud access to thousands of these specialized chips to startup companies in the field of artificial intelligence. As part of this deal, Tether will acquire 20% of the shares in Northern Data.

The report reveals that the purchase of the GPU was not made directly by Tether. In contrast, Tether uses the Irish shell company owned by Northern Data, known as Damoon, to carry out this transaction.

In this complex enough transaction, Northern Data will hold 70% of Damoon's shares, a figure previously announced in July. Forbes also noted that Northern Data has the potential to acquire Damoon's remaining shares, although the overall acquisition costs have yet to be confirmed.

The CEO of Northern Data, Aroosh Thillainathan, explained that they could not buy the chip directly from Nvidia because of the limited availability of the chip. Therefore, Tether decided to make this purchase himself.

Although this investment has attracted industrial attention, Forbes has also highlighted several controversies that surround Northern Data. The company has previously purchased hardware through shell companies and has missed certain financial reports. Even so, German regulators previously filed criminal complaints against false income reports, but the case was eventually closed without further action.

Meanwhile, Tether himself has been known for its stablecoin, USDT, which has a value of around US$83 billion (Rp1,276.5 trillion). This stablecoin has attracted debate over the lack of transparency around assets in its reserves.

It should be noted that Tether's move to invest in crypto mining is one of several of their expansions in the industry. In May, Tether has invested in mining companies in Uruguay, demonstrating their commitment to engage in the sector more deeply.

This investment worth IDR 6.4 trillion is expected to help Tether in securing the resources needed to support blockchain operations and maintain stability of its stablecoins in increasingly competitive markets.