The Senate of Paraguay suspended consideration of the draft law on a moratorium on mining cryptocurrencies, drawing attention to the financial side of the issue. Cointelegraph writes about this.
On April 3, a group of senators introduced a document that provided for a 180-day ban on mining cryptocurrencies and the opening of new bitcoin farms in the country. It was proposed to extend this period in the absence of full-fledged regulation of the industry and guarantees from the National Electric Power Administration (ANDE) of uninterrupted supply to the population.
Politicians referred to the theft of electricity by illegal miners, as well as network failures caused by them. With reference to ANDE, they announced an estimated loss of up to $60 million for the year. Despite the fact that all the claims concerned unregistered cryptocurrency miners, the senators proposed a total ban.
According to Hashlabs Mining co-founder Jaran Mellerud, the adoption of the bill would have resulted in more than $200 million in lost revenue for the country over the year.
On April 8, another group of legislators presented a declaration on the economic benefits of supporting miners whose investments are able to support the energy infrastructure.
Today We approved a Declaration WHEREBY THE SENATE OF #PARAGUAY SUPPORTS LOCAL AND FOREIGN INVESTMENTS IN INFRASTRUCTURE AND URGES THE MINISTRY OF INDUSTRY TO STUDY THE ECONOMIC ADVANTAGES OF SELLING OUR SURPLUS ENERGY TO THE #CryptoMining INDUSTRY. #BITCOIN pic.twitter.com/1sxptd5c8E
— Salyn Buzarquis (@SalynBuzarquis) April 10, 2024According to the document, in 2024, 45 registered enterprises in the industry can bring ANDE revenue of $48 million. The figure is expected to grow to $125 million in 2025.
At the same time, the cost of electricity production is about $ 22 per MW and when selling to miners for $ 40, the agency can receive 45% of net profit. Now the operator is forced to sell Brazil's surplus generation at a loss at a price of $10 per MW in a daily volume of 2,000 MW per day.
According to the authors of the declaration, the development of mining in the country will provide financial revenues that can be directed to the development of the energy system.
"This flow of funds will save ANDE from bankruptcy, provide an opportunity to invest in infrastructure and not raise tariffs for Paraguayans," the senators stressed.
Following the consideration of the document at a meeting of the Senate, parliamentarians scheduled a public debate on April 23 to discuss the advantages and disadvantages of mining.
Recall that in November 2023, the American Marathon Digital, the owner of the largest hashrate among public companies, began bitcoin mining in the country.