El Salvador’s Bitcoin holdings reach $373M

According to a report by the country’s “Bitcoin Office,” a government entity overseeing all Bitcoin-related projects, El Salvador could hold up to 5,750 BTC.

Since 2021, the nation has mined nearly 474 BTC by harnessing the geothermal power generated from the Tecapa volcano. Official data shared with Reuters by the power plant reveals that the government’s Bitcoin holdings accounted for over $354 million, but recent appreciation increased that sum to $373 million.

President Nayib Bukele has expressed his unwavering commitment to the cryptocurrency, stating that he has no intentions of selling the country’s vast Bitcoin holdings. The Bukele administration has reportedly installed 300 processors to mine Bitcoins using the volcano’s geothermal energy. He wrote:

When #Bitcoin’s market price was low, they wrote literally thousands of articles about our supposed losses. Now that #Bitcoin’s market price is way up, if we were to sell, we would make a profit of over 40%. […]

We won’t sell, or course; at the end 1 BTC = 1 BTC (this was true when the market price was low and it’s true now); but it’s very telling that the authors of those hit pieces, the “analysts”, the “experts”, the “journalists”, are totally silent now.

As ReadWrite reported in mid-March, at the time El Salvador’s Bitcoin holdings sat high on an unrealized profit of $84 million, with the treasury’s value increasing by 69% to over $206 million due to Bitcoin’s 250% appreciation over the past year. The country has also been working on its “Volcano Bonds” backed by Bitcoin which have cleared a major regulatory hurdle at the end of 2023.

A lot of power

The state-owned geothermal power plant dedicates 1.5 megawatts (MW) of its 102 MW output to cryptocurrency mining. Daniel Álvarez, president of the Rio Lempa Hydroelectric Executive Commission, which oversees the plant, emphasized the sustainability of their mining operations back in 2021:

We don’t spend resources that contaminate the environment, we don’t depend on oil, we don’t depend on natural gas, on any resource that isn’t renewable.

While El Salvador enjoys supportive government policies under President Bukele, the country still imports about one-fifth to one-quarter of its electricity. The remaining electricity production is divided among hydroelectric, geothermal, and fossil fuel-fired plants. Notably, geothermal energy accounts for about a quarter of the country’s energy, thanks to its 20 active volcanoes.

In an industry heavily reliant on polluting coal-fired power plants, the Salvadoran government is promoting the use of clean, renewable energy for local Bitcoin mining. With 300 computers powered by geothermal turbines, El Salvador is setting an example for sustainable cryptocurrency mining practices.

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