Argentina’s Bitcoin mining surges on cheap electricity

Argentines have taken advantage of ultra-low electricity prices to mine Bitcoin, according to Bloomberg.

“Even after a correction in Bitcoin’s price, the cost of electricity for all home miners is only a fraction of the income earned,” said Nicolás Bourbon, a miner from Buenos Aires.

According to the publication, another reason for the revival of mining’s popularity was the return of capital controls that restrict the free purchase of foreign currency.

Each year, Argentines lose about half of their savings to inflation. The law allows them to buy only $200 a month.

In 2020, interest in Bitcoin in Argentina rose to peak levels amid worsening economic conditions. In the same period, local congressman Ignacio Torres developed a bill to regulate cryptocurrencies.

Mining companies also decided to take advantage of cheap electricity. In late April 2021, Bitfarms announced plans to build a Bitcoin mining data center in Argentina with a capacity of 210 MW.

The agreement runs for eight years. For the first four years, the effective cost of electricity will be $0.022 per kWh. Bitfarms estimates that 210 MW will be sufficient to support about 55,000 next-generation miners.

In May, Argentina’s Federal Administration of Public Revenues required crypto exchanges to transmit monthly data on users’ transactions, the status of their accounts and balances.

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