The Argentine government is starting to learn about the electricity consumption of bitcoin mining companies after some provinces across the country faced power outages in the last days of 2021. Cammesa, the electricity wholesaler owned by the Argentine State, sent a note to heavy consumers of electricity to reveal if they are mining cryptocurrency. If so, companies should reveal their actual electricity consumption so that a price increase can be coordinated, and they will need to invest in electricity infrastructure.
Argentine government looks into Bitcoin mining
Argentina’s government is trying to determine the exact energy consumption bitcoin miners require from the national electricity grid, in order to take action to improve the current energy crisis facing the country. Cammesa, the state-owned energy wholesaler, sent a letter to all registered large consumers, asking them to report the energy consumption of any mining operations they might host, including the power consumed by what the company calls the “server group”. refrigeration equipment for cooling miners, and other associated equipment.
According to local media, the Argentine government – through the Under Secretary for Electric Energy – may consider taking action to get miners to pay more for this energy, launching a new tariff system and forcing crypto miners -currency to be invested directly in the electrical system. This is in order to relieve the stress that these operations would cause to the national grid, which in some cases has been faced with power cuts affecting more than 80,000 citizens and causing protests.
Secret mining operations
Local cryptocurrency experts explained that some companies have migrated to offer their space to host cryptocurrency mining operations, which has negatively affected the grid. An anonymous source revealed that these businesses are common and that there are more than 200 such farms in the country, at least half of which operate in Buenos Aires, Argentina’s capital.
It is said that the reason for the appearance of covert operations is the profitability that investors can achieve by avoiding taxes. Doing things secretly can speed up return on investment (ROI) times for mining investors, who could payback their investment in six months, compared to payback times of up to 18 months for other trades.
Bitcoin mining companies are eyeing Argentina for its affordable electricity costs. One such group is Bitfarms, which is already building a mega mining complex in partnership with a private third party that will ostensibly provide electricity without damaging the national grid.
What do you think of the new measures that the Argentine government is planning to take regarding bitcoin mining? Tell us in the comments section below.
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