El Salvador mined nearly 474 bitcoins, adding to state crypto holding, in last three years

By Thomson Reuters May 14, 2024 | 6:21 PM

By Nelson Renteria

SAN SALVADOR (Reuters) – El Salvador has mined nearly 474 bitcoins since 2021 thanks to a volcano-fueled geothermal power plant, official data showed on Tuesday, bringing the government’s total bitcoin portfolio to nearly $354 million at current prices.

The country’s “Bitcoin Office,” an official government entity, reports that government coffers now hold 5,750 bitcoins.

The new additions, 473.5 bitcoins worth some $29 million since September of 2021, were powered by a small amount of geothermal energy generated by the country’s imposing Tecapa volcano, touted as a green way to accumulate the well-known cryptocurrency, which is not regulated by any central bank.

The administration of Bitcoin enthusiast President Nayib Bukele, who earlier this year was reelected to a second term, has installed 300 processors to “mine” bitcoins from the volcano.

Of the 102 megawatts (MW) produced by the state-owned power plant, 1.5 MW are devoted to cryptocurrency mining. The so-called crypto mining process requires large amounts of energy for computing and cooling data processing centers, which perform complex math equations in order to secure cryptocurrencies like bitcoin.

Elsewhere in the world, cryptocurrency miners have recently come under increased scrutiny for their electricity-sapping operations, and for the impact their activity has on power grids and carbon emissions.

In 2021, El Salvador became the first country to adopt bitcoin as legal tender, alongside the U.S. dollar which it adopted two decades earlier. The bitcoin move earned Nayib’s government harsh criticism for its embrace of the volatile cryptocurrency, including from the International Monetary Fund (IMF).

Cryptocurrency miners Foundry USA, Ant pool, ViaBTC, F2Pool and Binance Pool pooled their resources to win a reward for opening a blockchain that can verify the last three years of bitcoin transactions originating from the power plant, according to the government Bitcoin Office.

(Reporting by Nelson Renteria; Editing by David Alire Garcia and Aurora Ellis)