Saturday, September 30, 2023

Welcome to Latam Insights, a compilation of the most significant cryptocurrency and economic news from Latin America over the past week. This edition covers the rise of the Volcano Energy Bitcoin mining project in El Salvador, the departure of Venezuelan miners amid a crypto corruption investigation, and Argentina’s increased utilization of the Chinese yuan for import payments.

Volcano Energy Unveils Renewable Bitcoin Mining Project in El Salvador

Volcano Energy, a Bitcoin mining venture, has revealed plans to construct a 241MW renewable power generation facility in El Salvador. The project will primarily rely on photovoltaic (solar) cells to generate energy, supporting what is claimed to be one of the world’s largest Bitcoin mining farms. In its initial stage, the mining operation will have a processing capacity of 1.3 EH/s.

The total development cost is projected to reach $1 billion, with the first phase receiving $250 million in funding from prominent players in the Bitcoin industry. Notably, Tether is among the companies involved, as part of its recently announced expansion into mining and renewable energy investments. Paolo Ardoino, CTO of Tether, expressed enthusiasm for the project and its potential to establish El Salvador as a global leader in renewable energy production.

Venezuelan Bitcoin Miners Depart Amidst National Mining Ban and Crypto Corruption Probe

Venezuelan Bitcoin miners are seeking alternative locations for their operations within Latin America due to a nationwide mining ban imposed by the government. The ban was implemented following allegations of a $20 billion corruption scheme involving the Venezuelan crypto regulator, Sunacrip.

An anonymous miner disclosed plans to relocate 2,000 ASIC mining rigs to Paraguay, citing the country’s affordable electricity rates and its welcoming stance towards Bitcoin miners, without imposing restrictions. Other miners are also considering moving their operations to Paraguay and El Salvador.

Argentina Sees Rise in Adoption of Chinese Yuan for International Settlements

Argentine businesses are increasingly adopting the Chinese yuan for cross-border payments to reduce reliance on U.S. dollars. Over 500 companies have transitioned to settling import payments with the Chinese yuan, taking advantage of currency protections introduced by the Argentine government in the financial system.

Of the nearly $10 billion available through the Chinese swap line, more than $2 billion in payments are currently awaiting approval.

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What are your thoughts on this week’s Latam Insights report? Share your comments in the section below.

Frequently Asked Questions (FAQs) about Latin America cryptocurrency news

Q: What is the Volcano Energy project in El Salvador?

A: The Volcano Energy project is a bitcoin mining venture in El Salvador that aims to construct a renewable power generation facility using solar cells. It is expected to be one of the world’s largest bitcoin mining farms.

Q: Why are Venezuelan bitcoin miners leaving the country?

A: Venezuelan bitcoin miners are relocating their operations due to a nationwide mining ban imposed by the government. The ban was implemented after allegations of a $20 billion corruption scheme involving the Venezuelan crypto regulator.

Q: Which countries are Venezuelan miners considering for relocation?

A: Venezuelan miners are considering Paraguay and El Salvador as potential locations to move their bitcoin mining operations. Paraguay is attractive due to its low electricity rates and welcoming environment for miners.

Q: Why are Argentine companies using the Chinese yuan for import payments?

A: Argentine companies are adopting the Chinese yuan for international settlements to reduce their reliance on U.S. dollars. This shift was prompted by the Argentine government’s introduction of currency protections in the financial system.

Q: How much funding is estimated for the Volcano Energy project in El Salvador?

A: The entire development of the Volcano Energy project is estimated to cost $1 billion. The initial phase, which involves constructing a renewable power facility, is being financed with $250 million from Bitcoin industry leaders.


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