05.03.2024

Chinese tea company to mine cryptocurrencies

The Chinese company Urban Tea, which produces and distributes tea, is discovering a fundamentally new direction. According to sources, now the firm will be engaged in the extraction of cryptocurrencies.

On the eve, the top of the firm made changes: they appointed Fendgan Zhou as chief operating officer and Dr. Yunfei Song as an independent director. All of this is needed to «lead and support the company’s critical strategic expansion into blockchain and cryptocurrency mining.» That is, the management wants to take advantage of the current popularization of the coin industry and make money on it.

Recall that mining is the process of selecting solutions for introducing new blocks with transactions into an existing blockchain. Thanks to their activity, miners protect the cryptocurrency network and make the funds in it safe. As a reward for their activity, they receive a reward in the form of a reward for the found block and a commission for making transfers from coin users.

We checked the actual data: now the interest in mining cryptocurrencies is at its peak. This was primarily a consequence of the growth of their rates. For example, now the hashrate – that is, the sum of computing power – in the Ethereum network is holding at a record height.

Ethereum hashrate

Ethereum network hashrate

Well, on the 2Miners mining pool, there are more than 32 thousand miners online. Although not so long ago, there were several times less.

Tea and cryptocurrencies

Zhou has experience working with blockchain-focused data centers. As stated in the company’s press release, he worked in Hong Kong prior to his appointment. Song was a scholar at the Chinese Academy of Sciences with experience in cryptocurrency mining and trading. Urban Tea CEO Yi Long said in a statement that the company’s crypto mining initiative came about as «blockchain technology and cryptocurrencies are gaining widespread popularity.»

This is indeed the case. Just this week, Bitcoin reached the psychologically important level of $ 50 thousand for the first time and went further – above 56 thousand as of this morning.

At the same time, the market capitalization of the project, that is, the product of coins in circulation by their rate, for the first time crossed the line of a trillion dollars, and the capitalization of the entire industry rose above 1.75 trillion.

stocks chart trading

Urban Tea Shares Rise Seriously In Recent Months

Here is a quote And on this occasion, in which it reflects the position of the company. The cue is from Decrypt.

In the future, we expect Urban Tea to begin expanding into the blockchain ecosystem, mining cryptocurrencies, building and maintaining cryptocurrency farms, and digital asset swaps.

That is, in general, the management of the organization not only wants to make money on the current trend, but also to make serious changes in its activity. It is not known what prospects this idea has, taking into account previous activities, but an attempt in any case deserves attention.

Moving to a crypt is an unusual move for Urban Tea. The company, founded in 2011 and with a market capitalization of $ 45 million , has focused on tea since the sale of its «chemical business» in April 2019. And now – literally out of nowhere – blockchain and Bitcoin mining have emerged on the horizon of its development.

Incidentally, this is not the first «tea company» that has decided to resort to a crypt-related business. In December 2017, when Bitcoin hit a new all-time high of $ 20,000 , another lemonade and tea company, Long Island Tea Corp, was renamed Long Blockchain Corp. Around this time, the firm was desperately trying to keep its shares listed on open trading floors, despite threats from the Nasdaq. Shortly after the announcement of its involvement in the crypto market, its shares rose in value by 500 percent.

However, the tale did not last long – already in the first half of 2018, the Bitcoin price plummeted, and the management of Long Blockchain Corp had to say goodbye to plans to create their own crypto farms. In the end, the management was forced to completely liquidate the business. In addition, Long Blockchain Corp has been the subject of an investigation by the FBI and the US Securities and Exchange Commission on suspicion of market manipulation.

We find ideas like these from CEOs of various companies amusing. They once again confirm that the cryptocurrency niche is one of the most profitable, so even those who have previously been engaged in completely different activities decide to contact it. I would like to believe that the initiative of the tea producer will not only end in success, but will also become an example for other giants from various industries.

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