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The recent rise in electricity costs implemented by the National Power Administration of Paraguay (ANDE) has prompted bitcoin mining companies to explore options in neighboring nations, including Argentina and Brazil.
A collaborative effort between Argentine and Brazilian firms has recently unveiled an 8 MW project with plans to achieve 200 MW by 2026, and more companies are expected to relocate, according to industry sources.
Paraguay Facing Bitcoin Mining Exodus Due to Power Fee Increase
Paraguay risks losing a significant portion of its Bitcoin mining sector.
As per industry sources, the recent hike in electricity fees for bitcoin mining operations is causing firms to reassess their long-term presence in the country due to more favorable conditions elsewhere.
Insiders have indicated that the 14% increase may be excessive for some companies already looking for alternatives in nations like Brazil and Argentina.
One such initiative is a partnership between Argentine and Brazilian firms that will now establish operations in the Zapala region of Argentina to benefit from energy incentives for businesses setting up there.
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The collaboration between “Zapala Mining” and “Patagonia 360” aims to leverage opportunities for bitcoin mining by utilizing non-conventional energy extraction methods in Vaca Muerta, one of Argentina’s largest oil fields.
The initiative aims to reach a generation capacity of 200 MW by 2026, commencing with 8 MW in October. However, this is not the only venture looking to relocate following the recent fee increase.
Fernando Arriola, president of the Paraguayan Fintech Chamber, noted that several companies have already signed agreements to move their operations to Argentina.
Arriola stated:
“Around six of our partners have already secured contracts in Argentina, as energy prices are more favorable. The cost ranges from 28 to 37 dollars.”
Arriola also indicated that the migration is imminent given the current circumstances in Paraguay, with only certain challenges related to importing bitcoin mining equipment potentially hindering it.
“Beyond that, I foresee a migration from Paraguay to Argentina and Brazil in the next six months, without a doubt,” he emphasized.
What are your thoughts on the migration of bitcoin mining companies from Paraguay to Argentina and Brazil? Share your views in the comments section below.
