Argentina eliminates power subsidies for cryptocurrency miners.
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The government of Argentina has eliminated the subsidies that were given to power used by cryptocurrency miners. This is the decision that the Energy Secretary of the country took regarding cryptocurrency mining, and according to the new 40/2022 resolution, published and made official on February 1st, miners will now pay almost four times what they did before.
Argentina raises power costs almost four times for crypto miners.
The new price of energy for miners in Ushuaia and the Rio Grande in Argentina will be 5,000 ARS (or $47.50) per MW/H. Before this resolution was published, these same crypto miners paid around 1,764 ARS (or $16.76) per MW/h. The reason behind the change is explained in the resolution, which states, “Due to the availability of payment and the profitability of the activity, it is considered opportune that these users face the payment of the price of energy equivalent to the cost of supply, being inequitable that they pay the price of a residential user or another.” Earlier, Argentina’s government had announced to tax cryptocurrencies in some areas.
Most crypto miners are located in Argentina due to the cold climate.
The latest resolution affects crypto miners located in the Tierra del Fuego province, where most miners are located in Argentina, due to the cold climate that allows the establishment of mining farms without intensive cooling capabilities. Cammesa, which is the energy wholesaler company in Argentina, faces a challenge trying to identify which sources are using the energy supplied for cryptocurrency mining purposes. Even though there is no official data to back it up, local energy companies seem to all agree on one thing: more and more people and companies are mining cryptocurrencies due to the low cost of energy that is subsidized at approximately 70% by the state.
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