A property in Salto del Guairá, Paraguay, containing 2,738 crypto mining units was seized by the National Electricity Administration (ANDE) after discovering an unauthorized power connection in the area. ANDE utilized artificial intelligence and power distribution analysis to uncover the electricity theft, estimated to be worth 1.1 billion guarani ($146,000) per month. Along with the seizure of the mining units, five transformers were also confiscated. The operators of the illegal operation may face four criminal charges.
In May, Paraguay conducted at least two other operations against illegal crypto farms, including one in Salta del Guairá, with less significant outcomes. These government actions involved various agencies, including the National Police.
Paraguay was previously considered a favorable location for crypto mining due to its abundant hydropower supply from the Itaipu Dam power plant. However, the country lacked regulatory legislation for crypto operations. In 2021, Congress introduced regulatory legislation, which was subsequently passed by the Senate in July of the following year.
However, then-president Mario Abdo Benítez vetoed the bill, specifically objecting to the provisions related to mining, which he believed incentivized the activity. Despite the country’s power resources, Abdo Benítez expressed concerns that crypto mining could hinder the development of national industries. Attempts to overturn the veto in the legislature were unsuccessful.
The crypto mining industry continues to operate in Paraguay, but it faces a potential ban proposed in April. The proposed bill aims to prohibit the creation, storage, marketing, and installation of virtual assets, cryptocurrencies, and crypto mining farms in Paraguay. The ban would remain in effect for 180 days or until comprehensive legislation is enacted and ANDE can ensure a sufficient power supply. The bill highlights the prevalence of illegal mining in the country. Although the temporary ban bill has been put on hold, official debate is postponed.
Despite the potential ban, Paraguay still hosts significant mining facilities. Bitfarms, Marathon Digital, and Tether have mining operations in the country. Additionally, Tether announced plans in November to establish mining facilities in Paraguay.
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