El Salvador, the first and only country that has taken the weird decision to adopt bitcoin as a legal tender, has found a succor to the energy challenge that comes with bitcoin mining.
On Friday, President Nayib Bukele tweeted that El Salvador is delving into volcano-powered bitcoin mining. The move, which is expected to erase the concern about the effect of bitcoin mining on the country’s electricity supply, is the first major step Bukele is taking to calm critical nerves.
His decision to make El Salvador a bitcoin country has been widely criticized, including by the International Monetary Fund (IMF) and World Bank.
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The flashy 25-second teaser video the president tweeted on Tuesday, includes shots of a government-branded shipping container full of bitcoin mining rigs, technicians installing and plugging in ASIC miners, as well as sweeping landscape aerials of an energy factory in the thick of a forest, bordering a volcano.
In June, Bukele said that he had instructed state-owned geothermal electric company, LaGeo SA de CV to “put up a plan to offer facilities for #Bitcoin mining with very cheap, 100% clean, 100% renewable, 0 emissions energy from our volcanos.” The video, which has since gone viral with more than 2.3 million views, is captioned simply with “First steps…” and is believed to be a sign that the president is moving to fulfill the promise he made three months ago.
“We’re still testing and installing, but this is officially the first bitcoin mining from the #volcanode,” Bukele tweeted, explaining that the project still has a lot of work.
Bukele explained that Salvadorians are embracing the bitcoin idea with rapid increase. He said that 2.7 million people are already using Chivo, a virtual wallet created to enable fee-free bitcoin transactions.
Other bitcoin miners were quick to support the volcano-powered bitcoin mining. SMSTR founder and CEO, Michael Saylor said the “mining upgrades thermal energy into digital energy that can be exported anywhere in the world and stored without power loss.”
As bitcoin lovers race to contain the concerns hanging around the carbon footprint of bitcoin mining, Volcano-powered energy has been widely touted.
“It’s just geothermal energy,” said bitcoin miner Alejandro de la Torre, who recently made the move from China to Texas. “Iceland has been doing it since the very, very beginning of bitcoin mining.”
Bukele’s delve into volcano-generated energy is the latest boost to the push to use cleaner energy alternatives to ameliorate bitcoin’s carbon footprint. It also sets El Salvador on the path of a new energy-based economic boom, given that the Central American country is home to volcanoes. Geothermal energy accounts for nearly a fourth of its domestic energy production, according to official data.
?A fully renewable, untapped energy resource has been put to work strictly because of bitcoin,” said bitcoin mining engineer Brandon Arvanaghi. “Bitcoin is the greatest accelerant to renewable energy development in history.”
El Salvador has mined 0.00599179 bitcoin, or about $269, with power harnessed from the volcano, amidst growing support by Salvadorians.
In June, El Salvador became the first nation to approve bitcoin as a legal tender, and has been working to contain the changes the decision will bring. Bukele said in June that the country is working on a new law that would grant permanent residency to any individual who invests three BTC into El Salvador’s economy. He added that the government will act as a backstop for entities that aren’t willing to take on the risk of a volatile cryptocurrency, since businesses are mandated to accept it.
The government has been increasing the volume of bitcoin on its balance sheet, buying the dip whenever bitcoin takes a dive. However, the future outcome of the decision remains uncertain, and will make or mar Bukele’s political career.