The National Power Administration of Paraguay (ANDE) has surprised cryptocurrency mining operators by raising power fees by 14%, affecting the profitability of these activities. The rise have already caused the exit of a company that planned to invest over $400 million in the country due to the lack of clarity in the area.
Paraguay Raises Crypto Mining Fees Potentially Affecting the Permanence of Bitcoin Mining Companies in the Country
The National Power Administration of Paraguay (ANDE) has announced an increase in power tariffs for bitcoin and cryptocurrency mining operations in the country that threatens the permanence of these companies. According to local media, ANDE raised power tariffs for crypto asset mining, blockchain, token, and data centers by 14%, potentially affecting the viability of maintaining these activities in the country.
ANDE issued the power fee raise on June 26, describing the increases for each high power consumption group on Resolution 49238. The backlash from industry insiders and pro-bitcoin groups was immediate, with politicians and elected senators criticizing this action.
Senator Salyn Buzarquis blasted the measure, assessing that it communicated an internal identity and contradiction problem in the Paraguayan government, potentially affecting future investments in the field. Buzarquis stressed that this action was unfair, given that these companies have already invested a humongous capital in Paraguay.
He declared:
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Which is the message? You are not welcome, go somewhere else! It is killing the business before the great wave of investments through the waterfall effect has been born.
Andy Jasmin, vice president of the Paraguayan Chamber of Digital Asset Miners, informed that this raise has already caused some to flee the country amidst the current instability. Jasmin stated that an unnamed company withdrew investments for $400 million given that they had been promised fee stability until at least 2028.
He concluded these actions showed investors that Paraguay was not a country for bitcoin mining “because there is no legal security, contracts are not respected, there is no security for investment and there is no security for betting on the country.”
Source: https://news.bitcoin.com/paraguay-raises-bitcoin-mining-power-fees-by-14-companies-mull-stopping-operations/