Key points to remember
- Salvadoran President Nayib Bukele has announced that the country has started leveraging volcanic energy to mine Bitcoin.
- El Salvador has implemented measures to strengthen Bitcoin infrastructure and adoption.
- Although mining via geothermal electricity (like volcanoes) is touted as clean bitcoin mining, the activity still has many critics.
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El Salvador’s bitcoin mining efforts are ramping up as the Central American nation successfully mined bitcoin using geothermal energy from a volcano.
El Salvador mines clean bitcoin using volcanic energy
Volcanoes in El Salvador have joined the crypto boom.
The president of the Central American country Nayib Bukele tweeted: “We’re still testing and installing, but this is officially the first #Bitcoin mining from the #Volcanode,” he wrote. The update only comes three days after Bukele posted a video of what appears to be a mining center in a remote location, announcingg that the country was taking its “first steps”.
There are up to 20 active volcanoes in El Salvador, and geothermal energy constitutes about 21% of electricity production in El Salvador. The nation has the highest level of geothermal production in Central America.
In June, El Salvador legislature approved Bukele’s proposal to adopt Bitcoin as legal tender. Bukele then quickly moved for instruct LaGeoa state-owned geothermal electricity company, to offer facilities for the clean mining of Bitcoin via volcanoes.
El Salvador’s journey to Bitcoin adoption has not been easy. The biggest in the country protests since Bukele became president in 2019 exploded in June after Bitcoin has been approved as an official currency, and there were technical issues when rolling out the Chivo Wallet last month. Additionally, the country’s Court of Auditors is set to probe its Bitcoin purchases. Proponents of the move to adopt Bitcoin have touted its use cases, particularly its usefulness in remittance payments, which constitute an important part of El Salvador’s GDP. The country has one of the highest remittance rates in the world today.
Much of the debate surrounding Bitcoin in recent months has focused on its environmental impact. A crackdown in China and Elon Musk’s announcement that Tesla would stop accepting bitcoin payments fueled environmental concerns in May, leading to a market-wide crash that saw bitcoin plummet 30% in one day . While China still appears to have a tough stance against Bitcoin, Musk said Tesla would accept Bitcoin as payment, provided it can be shown that a sufficient portion of the mining comes from renewable sources.
Disclosure: At the time of writing this article, the author of this feature held Bitcoin and several other cryptocurrencies.
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