Cheap power creates a Bitcoin mining boom in Argentina

The embattled South American nation of Argentina is experiencing a resurgence in cryptocurrency mining due to artificially low power tariffs imposed by national government subsidies. This fact, in addition to currency controls and the possibility of selling acquired assets at a higher exchange rate than the official exchange rate, is encouraging more and more people to engage in mining. Argentina is experiencing a mining boom Argentina is experiencing a mining boom due to highly subsidized electricity tariffs and currency controls that allow miners to sell their mined bitcoins at a higher exchange rate than the official rate set by the government. The growing interest in cryptocurrency mining is also related to Argentina being subject to capital controls that prohibit citizens from exchanging more than $200 in local fiat currency pesos; this, in turn, led to increased demand for other convertible currencies to protect their purchasing power from inflation. According to Bloomberg, the subsidies are so high that despite the recent price drop, Argentine miners are still in the green. Nicolas Bourbon, a miner, said: "Even after Bitcoin's price correction, the electricity costs of anyone mining from home are still a small fraction of the total revenue generated. This fact also sparked the interest of foreign mining companies to enter Argentina to take advantage of these subsidies. Bitfarms, a Canadian-based mining group, has struck a deal to mine power from a local factory at a much lower rate than most comparable alternatives. Geoffrey Morphy, president of Bitfarms, said: “We were looking for places that over-build power generation systems. Economic activity in Argentina is declining and electricity is not fully used. So this was a win-win situation. Sustainability at stake Argentina is the latest country to turn to crypto and mining as a way to reap greater financial and environmental benefits.

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