Mining altcoins is more profitable, even if you pay for the cheapest energy in the country. CriptoNoticias spoke with two miners with operations based in El Salvador.
Although it is the first country in the world to adopt Bitcoin (BTC) as legal tender, El Salvador is not necessarily a place where the generation of this asset is profitable. In fact, it is advisable to mine Bitcoin ensuring energy self-sufficiency; otherwise, it will be difficult to obtain considerable profits.
The average costs of USD 0.19 for each kWh (in the case of the service for business), a notable dependence on an international electrical network and the characteristic volatility of the first cryptocurrency, form the perfect cocktail so that the exercise of mining of Bitcoin lacks a presence in this country. Many investors have been cautious, and have even turned off their computers, when red flags abound in the market.
CriptoNoticias contacted a couple of miners with operations based in El Salvador. One of them is Abiezer Ventura. He is dedicated to mining Bitcoin, Ethereum (ETH), Ergo (ERG), Monero (XMR), Flux (FLUX), Conflux (CFX) and Alephium (ALPH).
Ventura: Generating Electricity is Paramount to Mining Bitcoin in El Salvador
Ventura believes that the profitability of mining Bitcoin in El Salvador depends on whether the operator has the capacity to generate its own electricity. In his case, the energy produced by himself power his mining farms; in other words, it works on a self-support basis.
This is possible with renewable energies, such as solar, obtained with panels. After the necessary process, and thanks to the sun, the electricity is the raw material for cryptocurrency mining, the process of validating transactions from a network, as well as their subsequent addition to the Blockchain.
“If one in El Salvador pays for energy, it is not profitable,” said the miner in an interview with CriptoNoticias. “The only way to be profitable to mine Bitcoin is to have a self-sustaining source of energy, a source of your own,” he said.
Gutiérrez: Bitcoin Mining Profitability Depends on Bitcoin Price
On the other hand, Alejandro Gutiérrez, another Salvadoran miner consulted by CriptoNoticias, argues that the profitability of Bitcoin mining in El Salvador depends mainly on the price of Bitcoin. Nevertheless, he admits that energy costs also play a role.
He claims that when BTC is up, it is more profitable to mine. However, when this is not the case, there are times when the miners must turn the equipment off, since the drop in price, plus the cost of energy service, could generate losses and red numbers for any investor.
In addition, he argues that this country, per se, is not profitable for Bitcoin mining “because we do not depend on ourselves for electricity generation.”
In Gutiérrez’s opinion, mining will be profitable in the future, when El Salvador begins to implement the widespread use of renewable energies, such as geothermal energy, which coincidentally has great production in that country. According to him, this would allow the energy independence of that nation.
“When that happens and we no longer depend on an external power supply system, things will change little by little, because electricity costs will go down”, he claims.
Based on the opinion of these Bitcoin mining experts, for those who want to delve into Bitcoin mining and other cryptocurrencies in El Salvador, the advice is to study and find out about the ecosystem and then define the investment capabilities, before undertaking an activity that still has much to offer in that country.
By Audy Castaneda
