In Argentina, which has experienced a severe economic crisis in recent years and has undergone many changes in its management, there is an explosion in cryptocurrency and Bitcoin mining thanks to the use of state-supported electricity.
Cryptocurrency is being talked about more and more in Argentina every day. As the economic crisis continues, the devaluation of the country’s currency, hyperinflation, and finally, the effects of the pandemic make everything worse.
1 Bitcoin 5.9 million pesos
According to Bloomberg’s report, while the government’s control and limitation of the purchase of US dollars increase the interest in digital currencies, there is an attack on assets other than the peso. As a result of this interest, the price of a Bitcoin increased to 5.9 million pesos in unofficial markets, while this figure was 3.4 million pesos in regulated exchanges.
Cheap electricity prices are the biggest factor
Argentina is an importing country, not producing energy resources such as natural gas and oil. Despite this, the electricity bill paid by a household is at most 2 to 3 percent of my monthly average income. This is a much cheaper price than other South American countries such as Chile, Colombia, and Brazil. State support for electricity also comes to the fore.
“Currently miner revenues are very high”
According to Nicolas Bourbon, a crypto-miner in Buenos Aires, electricity costs can be paid very easily despite the big correction in Bitcoin:
Despite Bitcoin’s massive price correction, even someone who mines from home can easily pay their electricity bill. The next bill is well below the earned figure. Because the cryptocurrency earned is sold at the price of the world markets, but the electricity is paid with the support of the state. Currently, miner revenues are very high.
International companies also realized this opportunity
International companies have also noticed this cheapness and opportunity in Argentina. Canadian mining firm Bitfarms Ltd. In its official statement last month. It announced that it has reached an agreement with South America’s largest Bitcoin mining facility, which produces electricity with natural gas. A power of 210 megawatts will be obtained from the power plant.
The Canadian company will pay $0.02 per kilowatt-hour. For electricity obtained from power plants that are not connected to the state grid, $0.06 is paid, or 3 times this price.
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