A property containing 2,738 cryptocurrency mining rigs in Salto del Guairá, Paraguay, has been seized by the National Electricity Authority (ANDE) after unmetered power connections were detected in the area. A bill has been introduced in the country’s Senate that would ban cryptocurrency mining and other cryptocurrency-related activities until there is comprehensive legislation and assurances from the country’s electricity provider.
ANDE used artificial intelligence and distribution analytics to prevent power theft worth 1.1 billion Guarani ($146,000) per month. Five transformers were also seized from the premises. Four criminal charges may be filed against operators of illegal operations.
At least two other actions were taken against illegal cryptocurrency farms in Paraguay last May, including one in Salta del Guairá, but the results of those raids were much more modest. All government actions involved multiple agencies, including the police.
Paraguay has been considered a cryptocurrency mining paradise thanks to its abundant supply of hydroelectric power from the Itaipu Dam power plant on the Parana River. However, the country lacked a legal framework for cryptocurrency operations. The regulatory bill was submitted to Congress in 2021 and passed the Senate the following July.
Cryptocurrency bill rejected, mining ban threatened
Then-President Mario Abdo Benítez vetoed the bill, particularly opposing mining-related provisions that encouraged mining activities. He said that even with the country’s power resources, cryptocurrency mining could deprive the country of its rapidly developing industry. Attempts to overturn the veto in the Legislature failed.
Related: Paraguay’s Proposed Bitcoin Mining Ban Could Cost $200 Million Per Year
The cryptocurrency mining industry continues to operate in Paraguay but is under threat due to legislation proposed in April. The bill “prohibits the creation, preservation, storage and marketing of virtual or cryptocurrency assets, cryptocurrency, and the establishment of cryptocurrency mining farms in the Paraguay region.”
The ban will remain in effect for 180 days or until comprehensive legislation is passed to ensure ANDE has sufficient power supply. The bill mentions rampant illegal mining in the country. The temporary ban has been put on hold, but the debate is officially considered ‘postponed’.
Paraguay still has major mining facilities. Bitfarms and Marathon Digital have mining operations there. Last November, Tether announced plans to build a mining facility there as well.
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