El Salvador is busy working on a Bitcoin-driven future. Mining from volcanic energy could soon be put into practice.
Bitcoin: This is the direct conversion of energy into a monetary medium. Be it hydropower, nuclear power, coal power or wind power – Bitcoin mines are looking for cheap electricity all over the world. After all, the mining market is so competitive that electricity costs of over US $ 0.2 per kilowatt hour (KWh) are already prohibitive. In Germany, you can forget about profitable mining from the start. With electricity prices averaging 0.31 euros per KWh of electricity, they are simply too high.
Now the Bitcoin network could be fed from another energy source that nobody had on their screen before. We’re talking about geothermal energy. At least since El Salvador’s President Bukele announced that he would be mining BTC using volcanic energy in the small Central American state, the community has gone mad. Bukele had instructed the chairman of the electricity company to work out a corresponding plan, he wrote on the morning of June 9th Twitter.
Said and done. Because just two days later, Bukele tweeted a drone video from the future power plant location. Bitcoin mines will soon be there that are “100 percent clean and powered by cheap electricity”.
A good day for El Salvador
The move is remarkable from several points of view. On the one hand, the sheer pace at which the country’s government is putting its plans for a crypto-friendly El Salvador into practice is impressive. We remember: We only received the news on Wednesday that the country’s parliament had passed the Bitcoin law. Since then, Bitcoin has been legal tender in El Salvador and the US dollar is legally equivalent.
In addition, El Salvador’s efforts are proof that the trend is moving more and more towards renewable mining. Instead of dirty coal-fired electricity, the country uses a natural and clean form of energy: geothermal energy. The thermal energy from the volcanoes is available anyway – so why not use it to promote the country’s financial inclusion?
That brings us to another benefit of the government’s Bitcoin rate. Because instead of US dollar foreign exchange (El Salvador does not have its own fiat currency), the country can now rely on the “production” of its own currency units. If mined BTC remain in the country, they can be used, for example, to set up a digital infrastructure. This is also urgently required. After all, the use of Bitcoin as a means of payment is only feasible if the citizens of the country have stable internet access – even in rural regions.
Bitcoin mining is getting greener
Bitcoin mining could turn out to be a real blessing in the future, especially for the expansion of renewable energies. As can be seen during the rainy season in Sichuan, China, BTC mines can act as flexible buyers for an oversupply of electricity. So if the volcano should gush at full speed, El Salvador could fire up its rigs and dig for digital gold with little effort. If the demand for electricity increases in other sectors, the mines could also be switched off at short notice without major losses and other industries could take precedence. Miners serve as a kind of compensation for voltage peaks and troughs.
A look at China also shows that mining is becoming ever greener. In several Chinese provinces, digging for digital stores of value is now prohibited if fossil fuels are used.
Most recently, there were a number of expressions of interest in the Bitcoin course El Salvador from Latin America. We have compiled the events in our news ticker.