The increase in the price of Bitcoin, as well as the attention that the cryptocurrency has received from institutional investors and the media, has also served to boost investments in crypto-asset mining. This is why one of the world’s largest mining companies, Bitfarms, announced the opening of a new mining farm in South America last year. And now, new details are known about how Bitfarms is advancing its mining plans in Argentina.
Bitfarms arrives in Argentina
For the past few years the biggest obsession for cryptocurrency miners has been electricity. And it is that, as the operations necessary for Bitcoin mining become more complex, they require increasing computing power to be completed. Something that mining farms can only provide in exchange for higher energy consumption.
Therefore, it is normal to see large mining companies looking for alternative locations for the installation of their new farms. With which they intend to take advantage of the increase in the price of Bitcoin to increase their profits. And in this sense, South America, with its generally low electricity costs and favorable year-round climate, is an attractive destination for companies like Bitfarms.
Which is why Bitfarms had already announced its intentions to build a 60 MW farm in Argentina since October 2020. But, if at that time this announcement was made through a non-binding memorandum, now the company is beginning to give details about the future of the operation. Including increases in energy capacity and agreements with local companies.
Mining in South America
Thus, Bitfarms advances its mining plans in Argentina with the signing of a contract with a local electricity supplier. It represents an increase in the initial consumption proposed by the company, now placing it at 210 MW, at a price of $ 0.022 per kWh. With this agreement having a duration of eight years, and Bitfarms expecting to produce a total of 11,774 Bitcoins or around 650 million dollars if the current price of BTC is maintained.
In addition, Bitfarms has also already established agreements with several local Argentine companies. Which will carry out the construction process of the new Bitfarms farm in South America, as well as provide the necessary engineering services for it to start operating. Estimating the company that could start operations in the country by the end of 2022.
This news is also importantly related to Bitfarms’ purchase of 48,000 state-of-the-art miners from MicroBT. A good part of which will be sent to Argentina to operate this new farm, according to the company itself. Thanks to which it is estimated that Bitcoins can be mined at a cost of $ 4,125 per BTC. Well below the $ 7,500 it currently costs Bitfarms to produce a Bitcoin in Quebec.