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Argentine Energy Firm Teams Up with Genesis Digital to Mine Bitcoin Using Stranded Gas

Argentine Energy Firm Teams Up with Genesis Digital to Mine Bitcoin Using Stranded Gas

May 8, 2024
Bitcoin Mining

Argentine Energy Firm Teams Up with Genesis Digital to Mine Bitcoin Using Stranded Gas

Genesis Digital Assets Limited (GDA), one of the world's largest Bitcoin mining companies, has entered into a collaboration with YPF Luz, a subsidiary of Argentina's largest electricity company, YPF. The partnership aims to establish a new Bitcoin mining facility in Argentina, which will harness stranded gas to operate.

The agreement was confirmed by YPF Luz CEO Martín Mandarano, who mentioned that the company has been involved in generating electricity from mining since 2022, as reported by the local newspaper Ambito. The operation is set to be located at the Bajo del Toro Thermal Power Plant, operated by YPF Luz, and will consist of 1,200 bitcoin mining machines.

The facility, located in Rincón de Los Sauces, in the Neuquén Province, is expected to have a total capacity of 7 MW, with an additional 1 MW for backup purposes. GDA Executive President Abdumalik Mirakhmedov, in an interview, highlighted Argentina's welcoming political and innovative climate for Bitcoin, as a key factor in the company's decision to expand there. He also pointed out the high usage of Bitcoin and stablecoins by Argentinians as a hedge against inflation.

This move by GDA provides an opportunity to generate a valuable return through Bitcoin mining without compromising Argentina's internal electricity demand. Latin America, not traditionally a major hub for Bitcoin mining, may experience a shift with Argentina leading the way, potentially followed by other countries in the region.

Mirakhmedov has expressed GDA's interest in further expanding within Latin America, with a current focus on Argentina due to its attractive electricity prices, temperature, potential for development, and sustainable energy sources.

The expansion comes at a time when Argentina's Bitcoin industry is gaining momentum, particularly following the election of Bitcoin-friendly President Javier Milei in late 2023. The public sector is working towards regulating the activity in line with the Financial Action Task Force and the International Monetary Fund requirements, while companies and users seek to maintain the growing adoption of Bitcoin.

The future of regulatory measures in Argentina remains uncertain, but GDA's announcement emphasizes the potential importance of the country for the Bitcoin mining industry.

GDA's project is part of a broader trend where countries are leveraging Bitcoin mining to improve energy infrastructure. Similar initiatives include Bhutan's use of hydropower and El Salvador's geothermal energy for mining, aiming to create a more productive use of energy resources.

Forbes Article


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