Canadian Bitcoin mining giant Hive Digital is betting big on Paraguay. 

The public firm—which trades on both the Toronto stock exchange and Nasdaq—announced Tuesday it bought 13,480 units of new mining machines to expand its operations in the South American country. 

Priced at over $60 million, the deal will help it secure 2% of the global Bitcoin network. The machines—Bitmain Antminer S21+ Hydros—deliver a hashrate capacity of 4.3 exahashes per second (EH/s). An exahash is a measure of a Bitcoin mining machine’s processing power.

The firm also secured an option to purchase an additional 4.3 EH/s worth of the same model, exercisable within one year. If the option is fully exercised, then Hive’s mining fleet could expand to 8.6 EH/s—and it hopes to hit a mining hashrate of 15 EH/s by the summer of 2025.

Executive Chairman Frank Holmes said that once fully deployed, the expansion to 15 EH/s would “propel Hive to over $300 million in annualized revenue and deliver more than $200 million in mining margin, based on current mining economics.” 

So why Paraguay? Hive has been eyeing up the opportunity for years. In 2022, the miner met with the President Santiago Peña for a 100-megawatt operation using green energy from the Itaipu hydroelectric dam. The site is still under development. 

Holmes told Decrypt that other than having an abundance of green energy, Paraguay’s government was “pro-business” and low-tax. 

He also said that the deal benefited the government: Instead of selling their cheap electricity to neighboring Argentina, they could flog it to Hive for its mining operation and receive dollars—and it works as an inflation hedge. 

“They sell electricity to Argentina for one penny, and there’s slow pay or no pay,” he said. “And here, with us, they get the money every month. They get U.S. dollars. So as the other currencies have been declining, it’s an embedded hedge, and their banks can’t hedge their currency against the U.S. dollar.”

“Here we’re helping Latin countries earn foreign currency in a stable manner,” he added. 

In the world of Bitcoin, miners are necessary to keep the network running and to mint new digital coins. Such operations now typically consist of huge warehouses full of expensive custom-built machines, making mining a costly and competitive endeavor.

Bitcoin miners are increasingly attracted to Paraguay for its cheap, green electricity—and lawmakers want to make it a crypto hub. 

President Peña previously said he wants the country—which neighbors Brazil, Argentina, and Bolivia—to be a tech hub and a “center of integration” between Latin America and the rest of the world. 

Edited by Andrew Hayward