El Salvador’s Volcano-Powered Bitcoin Mining Yields 474 Coins

El Salvador has mined close to 474 bitcoins since 2021, thanks to a geothermal power plant fueled by a volcano, official data showed on Tuesday. This development has boosted the El Salvador’s bitcoin holdings to nearly $354 million based on current market prices, as reported by Reuters. The government’s “Bitcoin Office,” an official entity, indicates that the nation now possesses 5,750 bitcoins.

These recent additions, amounting to 473.5 bitcoins valued at approximately $29 million since September 2021, were generated using a small portion of geothermal energy harnessed from the Tecapa volcano. This approach is lauded as an environmentally friendly method of acquiring the popular cryptocurrency, which operates outside the purview of central banks.

Under the leadership of President Nayib Bukele, an avid supporter of Bitcoin, who secured a second term earlier this year, the government has installed 300 processors to mine bitcoins from the volcanic energy source.

Out of the 102 megawatts (MW) generated by the state-owned power plant, 1.5 MW are allocated to cryptocurrency mining. This mining process, known as crypto mining, demands significant energy for the computational and cooling requirements of data processing centers, which execute complex mathematical equations to secure cryptocurrencies like bitcoin.

Elsewhere globally, cryptocurrency mining activities have faced growing scrutiny due to their substantial energy consumption and their impact on both power grids and carbon emissions.

In 2021, El Salvador made history by becoming the first nation to adopt bitcoin as legal tender, alongside the U.S. dollar, which it had adopted two decades earlier. However, this move drew criticism for the government of Nayib Bukele, including from institutions such as the International Monetary Fund (IMF), due to concerns surrounding the volatile nature of cryptocurrencies.

Various cryptocurrency mining companies, including Foundry USA, Ant Pool, ViaBTC, F2Pool, and Binance Pool, collaborated to receive a reward for validating blockchain transactions originating from the power plant over the past three years, as confirmed by the El Salvador’s Bitcoin Office.