Tether invests $1bn in Bitcoin mine in El Salvador

The stablecoin issuer USDT company Tether participated in the first round of financing Volcano Energy, a $1 billion Bitcoin mining project in El Salvador.

Tether Energy is doubling down on #bitcoin with our investment into Volcano Energy in El Salvador ??? We’re fueling sustainable Bitcoin mining and supporting El Salvador’s economic growth?⛏️

Learn more ? https://t.co/PlJ2yRhPR8 pic.twitter.com/fnpWuZW95t

— Tether (@Tether_to) June 5, 2023

The initiative aims to mine the first cryptocurrency using renewable energy from solar and wind power. The facility is planned to have a capacity of 241 MW and a hash rate of 1.3 EH/s.

The project secured $250 million in its initial phase. Tether did not disclose its stake.

According to the statement, the company will act as investor and advisor. The initiative is being implemented as a public-private partnership.

Before we get into specifics, let’s go high level stats.

— 241MW Total Renewables
— 169MW of Solar
— 72MW of Wind
— Projected 1.3EH/s Hash Power.
— $1bn Committed with $250mm in hand.
— 23% gov’t owned.
— 27% investor owned.
— 50% reinvested in energy production (good).

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— Rob W. (@BikesandBitcoin) June 5, 2023

Hosú Lopez of El Salvador was named CEO of Volcano Energy, and the board of directors is led by American television host and founder of Heisenberg Capital, Max Keiser.

«Volcano Energy represents one of the most innovative and strategic initiatives we are investing in. We look forward to working with Lopez and his team to make El Salvador a global force in renewable energy production. These investments continue Tether’s path toward diversifying its strategic ecosystem», — noted Paolo Ardoino, CTO of the USDT issuer.

In May he stated that the profitability of Tether provides an opportunity for the company to consider diversifying its business beyond the stablecoin offering. Ardoino identified energy, data exchange and financial infrastructure as priority areas.

Robert Warren, a partner at the American firm Distributed Hash, noted that Volcano Energy is more of an energy facility than a mining operation. To achieve a hash rate of 1.3 EH/s with latest-generation devices (around 13 000 units) roughly 52 MW of power would be required.

Ok, let’s get specific now.

Working backwards (conservatively):
— 1.3EH/s would be 1.3mm TH
— That’s 13,000, 100T Machines
— Assuming 250 machine per MW
— That’s 52MW of power.

Wait…. I thought they were building 241MW?!

4/ pic.twitter.com/iWRt5eovDr

— Rob W. (@BikesandBitcoin) June 5, 2023

Earlier, Salvadoran authorities began developing Bitcoin mining using geothermal energy from volcanoes.