El Salvador’s Bitcoin Volcano in sight
El Salvador's ambitious Volcano Energy project aims to create a global Bitcoin mining powerhouse fueled by renewable solar and wind energy.
El Salvador continues its dedication to becoming a global leader in the Bitcoin mining industry through the development of its ambitious Volcano Energy project.
The country plans to add 241 MW of renewables and 1.3 Eh/s of Bitcoin mining, marking a further step towards “economic freedom,” energy competitiveness, and “self-reliance,” as shared on Twitter by Bitcoin advocate Dennis Porter.
Harnessing the country’s renewable resources, the project aims to establish one of the world’s largest Bitcoin mining farms, accompanied by the creation of Volcano Tokens.
The Volcano Energy project focuses on developing a 241 MW renewable power generation park in the Metapan region of El Salvador. This park will showcase the “exceptional solar and wind energy yields available in the country,” with 169 MW of photovoltaic solar and 72 MW of wind energy.
The initial computational power of the Bitcoin mining farm will surpass 1.3 EH/s, funded by a total commitment of $1 billion for the project from “Bitcoin industry leaders.” In addition, the Government of El Salvador will play a role in the project, securing a “preferred participation equivalent to 23% of the revenues.” Furthermore, investors will own 27%, and the remaining 50% will be reinvested in “expanding energy production capacity and advancing Bitcoin mining.”
For comparison, Hashrate Index lists the top mining pools by hashrate, indicating that El Salvador would be a top 20 mining pool by comparison. The largest pool is Foundry with 111.2 EH/s, followed by AntPool, F2Pool, Binance Pool, and ViaBTC pool with 85 EH/s, 50 EH/s, 33 EH/s, and 32 EH/s respectively. At 1.3 EH/s, Volcano Energy would have an equivalent hashrate to NiceHash and KuCoin.
In an April 2022 interview with CryptoSlate, Bitfinex & Tether CTO Paolo Ardoino discussed the revolutionary Bitcoin-backed Volcano Token (VT), representing the first tokenization of a sovereign bond.
He explained that the token serves as a capital raise for El Salvador’s sovereign debt. Half the $1 billion raised will be used to buy and hold Bitcoin for five years, with profits split between infrastructure development and distribution to Volcano Token holders.
Ardoino also revealed that the underlying blockchain for the Volcano Token issuance would be Liquid, chosen for its allow listing feature, helping meet strong KYC and AML requirements from regulators.
Bitfinex Securities will trade the token once the necessary legislative approval is obtained and the company secures a license in El Salvador.
According to Ardoino, he stated that this process could be completed in a matter of weeks. However, a recent Bloomberg report noted that the token is expected sometime in 2023.