Paraguay’s President Santiago Peña has dismissed complaints from Bitcoin mining farm operators regarding the recent power fee hikes enacted by the National Power Administration (ANDE). Despite operators’ concerns, Peña emphasized that the government does not need to consult with these companies before implementing such changes.
Power Fee Hikes and Industry Impact
The Paraguayan government has approved a power fee hike of up to 14%, specifically affecting Bitcoin mining operations. President Peña stated that while this increase would reduce the profit margins for these businesses, it would not deter them from continuing their activities in the country. He also noted that the Bitcoin mining industry does not create a significant number of jobs, which further justifies the fee hike.
Contracts and Legal Disputes
Peña clarified that the contracts with Bitcoin mining companies did not require the government to seek mutual consent before adjusting power fees. “The contract says it can increase if the cost of energy rises,” he stressed.
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Industry Response
Despite Peña’s assurances, Capamad, a Bitcoin mining association that includes major players like Bitfarms, criticized the government’s actions. They argue that the contracts with ANDE stipulate that any changes should be made with mutual agreement. The organization warned that these measures damage Paraguay’s image and jeopardize its investment grade by undermining legal certainty.
Future Prospects
President Peña remains optimistic about Paraguay’s future as a hub for technological innovation. He stated that even with the increased power fees, many Bitcoin companies are still interested in setting up operations in the country. “We are preparing for the arrival of companies that we believe will generate dynamism and will be part of a technological ecosystem in which we are working, to turn Paraguay into a technological center,” Peña declared.
However, some companies are already considering relocation due to the fee hikes. Penguin Group, a member of Capamad, has secured a 400MW site in Brazil, and other firms are exploring similar moves to neighboring countries.
