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As miners withdraw from China, the industry in Argentina is experiencing a real boom. In addition to the weakness of the national currency, one of the reasons is the price of electricity subsidized by the state.
At the moment, the mining scene is on the move. After the Chinese government announced that it wanted to toughen the measures, miners are pulling out and becoming more active in other countries. Argentina is an example of this. The reason for this is cheap electricity relative to the weak local currency.
Argentine politics has also contributed its grain of sand to increase the popularity of cryptocurrencies among the population. Currency controls prohibited locals from buying more than $ 200. The government is desperately seeking measures to halt the three-year recession. However, the ongoing corona pandemic has eased the situation.
This situation plays out on the miners’ cards. Furthermore, there is a special feature of the state subsidy for domestic electricity that exists in Argentina. For miners, this means that they can bring the mined bitcoins to market at the normal price, but benefit from subsidies for electricity. This causes revenue to skyrocket even more.
Therefore, it is obvious that mining companies perceive their potential to make large profits. Last month, Bitfarms Ltd. announced that it had struck a deal to directly tap into a local power plant. Bitfarms can use it to source up to 210 megawatts of electricity from natural gas and thus would operate the largest Bitcoin mining facility in South America. 55,000 state-of-the-art computers will run on the mining farm and generate 11,774 BTC per year. Bitfarms specifies the current electricity tariff of the mining center as a paltry value of US $ 0.022. This is just over a third of the price paid by off-grid industrial customers in the United States.
We looked for places that had their power generation systems rebuilt. Economic activity in Argentina is slowing and electricity is not being fully used. So it was a win-win situation for everyone.
Bloomberg quotes Bitfarms chairman Geoffrey Morphy from an interview.
In addition to the weak local currency and the subsidized price of electricity, another favorable cost factor is the fact that the plant does not need expensive immersion cooling due to the favorable year-round climate in Argentina to keep miners cool and cool. operate optimally. .
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