Bitcoin Mining Exodus: Companies Flee Paraguay for Brazil Amidst Rising Electricity Costs

The recent electricity tariff hikes imposed by Paraguay’s National Electricity Administration (ANDE) on Bitcoin mining companies are driving operators out of the country. Reports indicate that Penguin Group, a cryptocurrency mining operator, has already secured a 400MW energy contract in Brazil, setting a precedent that other companies might follow, according to Bitcoin.com.

Paraguay’s Bitcoin mining companies are increasingly eyeing Brazil as an alternative location. The recent 14% increase in energy tariffs by ANDE has made Bitcoin mining operations in Paraguay less viable, prompting operators to seek more favorable conditions elsewhere.

Penguin Group, one of the affected companies, has already made a move to Brazil. CEO and co-founder Bjorn Schmidtke announced that Penguin has secured a contract for 400MW under “excellent conditions” with an additional 400MW in the pipeline.

Bruno Vaccotti, head of public relations at Penguin, attributed this shift to ANDE’s “excessive greed,” which jeopardizes over 150 jobs that the company currently supports in Paraguay. Vaccotti expressed regret over the impact of the energy tariff hikes on the Bitcoin mining industry in Paraguay, criticizing ANDE’s short-sightedness and the lack of technical basis for their decisions.

“This effort by Paraguay is pushing the industry out, driven by greed and arrogance, without considering the long-term effects,” Vaccotti stated.

Vaccotti has previously criticized ANDE’s actions against illegal Bitcoin mining, acknowledging the need for enforcement but highlighting other pressing issues affecting the industry, such as “vulture contracts.”

Meanwhile, Bitcoin mining industry representatives are seeking meetings with Paraguay’s President Santiago Peña and ANDE officials to discuss the possibility of reversing the tariff hikes to sustain their operations in the country.