The National Power Administration of Paraguay (ANDE) has unexpectedly increased electricity fees by 14% for cryptocurrency mining operators, impacting the profitability of their ventures. This hike has already driven away a company that intended to invest over $400 million in the nation due to the uncertainty in the sector.
### Paraguay Raises Crypto Mining Fees, Potentially Jeopardizing Bitcoin Mining Companies’ Operations
The National Power Administration of Paraguay (ANDE) has revealed a significant hike in electricity tariffs for bitcoin and cryptocurrency mining operations, endangering the presence of these businesses in the country. As reported by local media, ANDE has raised power tariffs for crypto asset mining, blockchain, token, and data centers by 14%, potentially undermining the sustainability of these activities in Paraguay.
On June 26, ANDE implemented the tariff increase through Resolution 49238, detailing the hikes for each high power consumption category. The response from industry insiders and bitcoin advocates was swift and critical, with politicians and elected senators denouncing the move.
Senator Salyn Buzarquis criticized the decision, suggesting it revealed internal discord and identity issues within the Paraguayan government, potentially deterring future investments in the sector. Buzarquis argued that the action was unjust, especially since these companies had already committed substantial capital to Paraguay. He stated:
“What’s the message here? You are not welcome, go elsewhere! This decision kills the business before the anticipated investment boom can even begin.”
Andy Jasmin, vice president of the Paraguayan Chamber of Digital Asset Miners, reported that the increase had already prompted some companies to leave the country amid the prevailing instability. Jasmin noted that one company had retracted $400 million in investments because they had been assured of stable fees until at least 2028.
He concluded that these actions conveyed to investors that Paraguay was not a suitable location for bitcoin mining “because there is no legal security, contracts are not honored, and there is no security for investment or confidence in the country.”
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