The project is led by reputed investor, Max Keizer, and counts Tether among its investors. It plans to harness renewable energy in the north of the country to mine Bitcoin.
- Volcano Energy goes live with an initial investment of USD $250 million.
- The Bitcoin mining project is backed by Max Kaiser and Tether.
- Secured an investment commitment of USD $1 billion.
- It is building a renewable energy park to power mining operations.
A group of entrepreneurs has partnered to launch a Bitcoin (BTC) mining project in El Salvador that aims to take advantage of the country’s abundant natural resources, including its volcanoes.
Dubbed ‘Volcano Energy’, the public-private initiative was launched this week with an initial investment of USD $250 million and a staggering USD $1 billion injection commitment. The company responsible plans to use the capital to build a power generation park that will eventually power cryptocurrency operations.
Backed by reputable industry leaders, the project “is a transformative journey that will establish one of the largest Bitcoin mining farms in the world,” reads a statement shared this week on Twitter.
Wait is over! The power of @Volcano_Energy is here 🌋🔌#ElSalvador #BTC #Bitcoin #VolcanoEnergy pic.twitter.com/HTkd5ZOKfM
— Volcano Energy 🇸🇻🌋🔌 (@Volcano_Energy) June 5, 2023
Located in the Metapán municipality, the new park will generate a total of 241 megawatts (MW) of renewable energy, combining solar and wind projects. With a capacity of 169 MW of solar energy and 72 MW of wind energy, it will feed the Bitcoin miner that will reach a computing power of more than 1.3 exhash per second (EH/s), according to the note.
Our main objective is to position El Salvador as a prominent global player in the Bitcoin mining industry, while simultaneously promoting energy competitiveness, diversification and geographic expansion of the Bitcoin network.
The project appears to have intentions to eventually harness geothermal energy, generated by volcanoes, to power its operations; although it is unclear how the solar and wind energy park would connect to volcanic activity.
Backed by Tether and Max Kaiser
Volcano Energy is backed by Max Kaiser, a podcaster and Bitcoin enthusiast known for his financial show, Keizer Report. The development of the project is driven by Josué López, a Salvadoran engineer, who serves as CEO of Volcano Energy, while Kaiser holds the position of president of the initiative.
The Salvadoran government will also play “a crucial role” in planning and execution and has secured a “preferential participation equivalent to 23% of revenues,” Volcano Energy said. Outside investors will own 27% of the company and the remaining 50% will be “reinvested” to expand energy production and mining capabilities, it added.
The project also has participation from notable companies, including Tether, the issuer of USDT. In a separate statement, the company behind the leading stablecoin by market capitalization disclosed participation in a first round of investment from Volcano Energy, though without specifying the amount.
“We are excited to be among the early pioneers of renewable energy in El Salvador as an equity investor and advisor,” Paolo Ardoino, Tether’s chief technology officer, said in that note.
The move is part of Tether’s more ambitious bet on Bitcoin. The USDT issuer announced last week that it is preparing to start BTC mining operations in Uruguay and plans to buy Bitcoin to add to its reserves.
El Salvador adopted Bitcoin as a legal tender in 2021 and has since been attracting the attention of entrepreneurs and industry firms, positioning itself as a crypto-friendly hub in Latin America. The efforts contrast with the strict regulatory stance being taken by other jurisdictions such as the US.
