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Nine Bitcoin mining companies have suspended their operations after the power fee hikes affecting high-consumption customers in Paraguay. According to data provided by the National Power Administration of Paraguay (ANDE), these companies had their service terminated due to the interruption of their payments, or just because they did not want to continue operating.
Power Fee Hikes Affect Bitcoin Miners in Paraguay: 9 Companies Opt-out
The income received by power sales to bitcoin miners is starting to be affected by the measures taken by the National Power Administration of Paraguay (ANDE). Hugo Rolon, ANDE commercial manager, stated that while there had been no contract rescissions as a consequence of the fee hikes enacted for bitcoin miners last month, service interruptions had indeed taken place.
According to local media reports, Rolon stated:
As for crypto mining clients, we have not processed contract cancellation requests; we do have nine clients who were cancelled due to non-payment of their invoices or because when they were regularized to the category, they communicated that they will not continue with the activity.
Several bitcoin mining industry representatives had warned about the effects of the recent power fee hike, which raised energy fees for miners by up to 16% depending on their power expenditure. Fernando Arriola, director of the Paraguayan Fintech Chamber, declared that the country risked becoming irrelevant for the industry after the referred hikes.
Before, some companies had also referred to the possibility of moving to Brazil. Last month, Penguin, one of these, announced having signed a 400MW agreement in Brazil, with another 400MW still in negotiations. Penguin Chief of Public Affairs Bruno Vaccotti criticized this rate increase, stating it was “excessive greed” on the Paraguayan government’s behalf.
Bitcoin miners sought to meet with the Paraguayan president to mitigate the effects of this action or to avoid its enactment. Nonetheless, President Santiago Peña disregarded these concerns, stating that while this measure would reduce the margins of the activity, it would not discourage the practice of the activity in the country.