A public-private partnership in El Salvador has gained its first $250 million to begin a $1 billion project to construct a Bitcoin (BTC) mining farm. This initial release of funds will fund a 241-megawatt (MW) power generation park in Metapán, El Salvador.
Volcano Energy, the firm responsible for the location, disclosed that the money would be used to construct the power generation park that will be powered by solar and wind energy, which will eventually be utilized for the Bitcoin mining activity. On June 7, Volcano Energy chairman Max Keiser communicated the news on Twitter.
The process of Bitcoin mining requires the utilization of powerful computers connected to a global network, with an immense amount of electricity consumed in the process. This energy-draining practice has been heavily criticized by environmentalists, who are worried that it increases deforestation and worsens global warming.
Tether, an issuer of stablecoin, is one of the investors in the first funding round for Volcano Energy’s development, though the amount of its investment is not revealed. Paolo Ardoino, Tether’s Chief Technology Officer, stated that the investment signals the company’s intention to promote investment in renewable energy production and mining infrastructure.
According to Volcano Energy, the power generation capacity of 241 MWs will be split between 169 MWs of photovoltaic solar energy and 72 MWs of wind energy. Tether estimates that the computing power of the park will surpass 1.3 exahashes per second. If this is reached, Volcano Energy’s total Bitcoin mining hash rate will be one of the top 20 pools globally.
Volcano Energy states that the park is a pioneering example of Bitcoin mining powered by renewable energy, demonstrating the industry’s incessant progress and development in a challenging environment.
The Salvadoran government will be essential in the devising and implementation of the project, ensuring they have a share of 23% of the profits. The investors will possess 27%, with the remaining 50% going towards the expansion of energy production and the development of Bitcoin mining.
Author of ‘The Bitcoin Standard’ has been appointed as an economic adviser to El Salvador.
Keiser, a proponent of Bitcoin and host of a podcast, is a key part of El Salvador’s adoption efforts, acting as a consultant to President Nayib Bukele and chair of Volcano Energy.
The Central American nation is carrying on its attempts to promote Bitcoin usage after being the first country to declare Bitcoin a legal form of payment in 2021.
What is the experience of utilizing Bitcoin in El Salvador really like?
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