Canadian bitcoin miner Bitfarms has announced its plans to start operations in Argentina in early 2022, with a total of 55,000 machines, it was reported. The country emerged as a logical choice due to its relative low expenses in local pesos with all profits in bitcoin, analysts said.
“The company has entered into a significantly enhanced power purchase agreement with a utility grade private power producer in Argentina, under which Bitfarms has the right to extract up to 210 MW of electricity at its discretion. The initial duration of the contract is eight years. During the first four years, the effective cost of electricity will be US $ 0.022 per kWh, ”the company, founded in 2017, said in a statement.
Translated into numbers, 210 MW is enough to install 55,000 mining machines and generate around USD 650 million of revenue or 11,774 bitcoins, based on current difficulty levels and a cryptocurrency price of US $ 55,000 per unit.
One of the main reasons Bitfarms chose Argentina was the price of energy. In the Canadian city of Quebec, the cost to mine one bitcoin is roughly US $ 7,500, compared to USD 4,125 in Argentina, which would represent 45 % in savings.
With up to 210 MW of low-cost power available, the Argentine facility is expected to be a significant contributor to Bitfarms reaching its 8.0 EH / s target by the end of 2022, the statement went on.
Bitfarms also explained negotiations were well underway with a well-accredited construction company in the electrical infrastructure and civil construction sector to design and build the electrical interconnection, high voltage power lines and transformers required to carry out this type of operation.
“The proposed new mining facility is very close to the utility company and, as such, the electricity contract does not imply any interconnection with the local electricity grid, which has significant advantages, which allow our miners [to] operate with maximum efficiency and performance, regardless of the conditions applicable to the local electricity grid”, the Canadian company explained.
Although the exact location of the farm has not yet been disclosed, it is expected to be in Patagonia, more specifically in Tierra del Fuego, due to its icy temperatures. With a favourable climate throughout the year, the installation in Argentina does not require expensive liquid immersion cooling to keep miners cool and operating optimally. Bitfarms did mention in its statement.