Key facts:
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It’s been 2 and a half months since the national farm blackout and there is no news from Sunacrip.
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Paraguay has its doors open for Venezuelans, say the Fintech Chamber of that country.
Fleeing from Venezuela, that is the resource that several Bitcoin miners who decided to leave their country are resorting to, where the industry is in a regulatory limbo, two and a half months after the National Superintendence of Cryptoactives and Related Activities was intervened ( sunacrip).
“This is a disaster,” Manuel Martínez (false name to protect his identity) told CriptoNoticias. “There is too great uncertainty regarding Bitcoin mining in Venezuela and the truth is that we are all looking for at least a little stability”, he added.
In March, hash producers licensed to operate in the country were taken offline. This after a commission from the National Electric Corporation (Corpoelec) visit the farms and give the order to stop operationsin the midst of investigations related to the Pdvsa-Crypto corruption plot.
“At that moment we were told that they were taking the measure as a result of Sunacrip’s intervention, since there was no clear process for charging electricity rates, since the regulatory entity was in charge of it,” another miner explained. who preferred to speak on condition of anonymity.
However, to this date, when almost three months have elapsed since the massive shutdown of farms, time is running out for miners who have had to continue covering operating expenses and are waiting for an order to resume activities to be issued.
The auditing board appointed by the government to restructure Sunacrip has not issued any statement. Therefore, it is unknown what the status of that process is or when there may be a response for digital miners.
Some miners speak of 6 months of darkness for Venezuelan digital mining, while others suspect that Sunacrip will disappear. In that case, Uncertainty will remain regarding all cryptocurrency-related activity in Venezuelan territory.
The exodus of digital miners from Venezuela begins
The Bitcoin miners with whom CriptoNoticias spoke say that there are several farm owners who have decided to relocate their operations to other countries where greater stability is currently offered to mine Bitcoin.
There is no precise figure on how many miners plan to emigrate, there is only talk of “several” and these they mention Paraguay and El Salvador as their destination countries.
After evaluating the alternatives, Manuel Martínez decided that Paraguay will be the country in which he will establish his mining farm.
“Paraguay has one of the cheapest electricity rates in Latin America and is a country that has open arms for Bitcoin miners to whom it is not imposing restrictions or anything like that. And also the tax rates of 15% seem quite attractive to us”.
Manuel Martínez, Bitcoin miner in Venezuela.
He assures that he is in the process of moving his 4,000 KVA farm (kilovolt-ampere) that in Venezuela kept running 1,800 AntMiner S9 and 200 Whatsminer M20for a total of 2000 ASIC (Application Specific Integrated Circuit) or specialized equipment for digital mining.
“I manage foreign capital and the truth is that my clients do not understand how it is that in Venezuela there are no answers from a governing body for digital mining that tells us when we are going to be able to turn it on or what is really happening. It is also not known if electricity prices will increase or if farms will close again in the event of any eventuality in the future and this is something that does not seem fair or legal for an industry that is productive and generates jobs.
Manuel Martínez, Bitcoin miner in Venezuela.
Paraguay and El Salvador the favorite destinations of Venezuelans
While some Venezuelan miners are waiting for Sunacrip to issue a statement, others decide to close operations indefinitely. Meanwhile, others are getting ready to emigrate.
Paraguay is receiving Bitcoin miners who wish to settle in the country, Fernando Arriola, who is head of the blockchain division of the Paraguayan Chamber of Fintech, told CriptoNoticias.
“Recently, mining companies from the United States and Asia have been arriving in Paraguay, but also fromWe are open to receive Venezuelans who wish to settle in our countryArriola explained.
He added that Bitcoin can be mined in Paraguay with peace of mind, since the activity is aligned with the country’s energy policy, where an environment of transparency and formality is promoted.
The National Energy Administration of Paraguay (Ande) defined the electricity rates for Bitcoin miners, which currently stands at USD 0.052 per kWh.
“In our country there are no restriction measures that harm the operations of miners, We only need a legal framework and we are looking for it since in July we will present a new bill again”, explained Arriola.
While some Venezuelan miners look to the Paraguayan side, others say they are contacting the government of El Salvador, with the idea of transferring its infrastructure to the Central American country.
Precisely this June 5, El Salvador announced its plans to boost Bitcoin mining in the western part of the country, specifically in the municipality of Metapán, Santa Ana.
There it is planned to install “one of the largest Bitcoin mining farms in the world”, with an initial computer power of more than 1.3 EH/s.
The project is hopeful for several Venezuelan miners who are now looking to settle in new territories.
“It hurts me to leave Venezuela behind, but I must save my business”
Manuel Martínez began operations with his mining farm in 2019, with Antminer S9K equipment.
“First we started testing everything and some time later a capital of around 100,000 dollars was injected that we used to buy machines and infrastructure. And so we acquired the first 1,500 KVA transformer in which we placed 400 machines (200 M3 equipment and 200 S9 machines) that later gave us a very lucrative return with which we now have 2,000 machines”.
Manuel Martínez, Venezuelan Bitcoin miner.
To show a bit of how the massive blackout of farms in Venezuela is affecting him, Martínez says that is stopping generating about 16,000 dollars a month, only with 100 of its Whatsminer equipment. This means that this figure has tripled, if we take into account that almost 3 months ago the licensed mining operations in the country were disconnected.
“Besides, we have had to continue paying the rent and cover everything necessary as if we were still operating. We have even been forced to fire employees, since we have no way to pay them. We regret that now these are families that were left without that income, since we paid our workers very well.”
Manuel Martínez, Venezuelan Bitcoin miner.
Martínez says that, with pain, he will leave his country, but he is forced to emigrate to save his business. He also states that the current situation is scaring away foreign investors, which further blocks the possibility of undertaking since there are no sources of financing to go to to promote new projects.
There are always going to be people who will probably follow mining Bitcoin taking advantage of cheap electricity in Venezuela. But you also have to consider that there is another cost to pay, such as the fact that there is no legal security or any other type of security in Venezuela, hence my decision to leave”, he pointed out.
