Paraguay Takes Radical Steps to Counter Clandestine Bitcoin Mining

Paraguay, a small landlocked country in Latin America, faces a major challenge related to illegal Bitcoin mining. Faced with the growing threat posed by these clandestine mining activities to its national electricity network, the Paraguayan government has decided to toughen up its tone. He thus submitted a bill aimed at imposing prison sentences of up to 10 years for those involved in clandestine Bitcoin mining.

Bitcoin mining, also known as mining, is a process of solving complex mathematical problems to validate Bitcoin network transactions. However, this activity requires a considerable amount of electrical energy.

In Paraguay, where electricity is abundant and inexpensive thanks to its numerous hydroelectric plants, many Bitcoin miners have set up shop to exploit this natural resource. However, these illegal miners began using unauthorized power connections and overloading the national power grid, causing frequent outages and disruptions in electricity distribution. This, in fact, reminds us that Bitcoin miners in Kazakhstan were forced to limit their operations in 2023, following the same power outage issues.

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Faced with this situation, considered alarming, the Paraguayan government has decided to take drastic measures to stem this clandestine Bitcoin mining. The proposed bill provides for prison sentences of up to 10 years for anyone involved in these illegal mining activities.

Many miners have settled illegally in Paraguay, illegally plugging into the national electricity grid without paying the price. These small clandestine units, difficult to regulate, have caused numerous power outages and significant financial losses for the network operator, ANDE. According to the authorities, each illegal mining unit would cost ANDE nearly $95, representing a cumulative loss of $000 million for the Upper Paraná region alone.

In addition, the government has also intensified its efforts to detect and dismantle illegal mining operations. He created a special police unit tasked with tracking down illegal miners and seizing their mining equipment. Raids were carried out in several parts of the country, resulting in the closure of a number of illegal mining operations.

Paraguayan authorities have also launched an awareness campaign to inform the population of the dangers of clandestine Bitcoin mining. They pointed out that this illegal activity not only overloads the national power grid, but also contributes to environmental degradation due to excessive energy consumption. Paraguay is the country with the cleanest electricity production in the world, along with Albania, as reported by United Nations Development Program.

The measures taken by the Paraguayan government have been welcomed by the international community. Many countries facing the same problem of illegal Bitcoin mining have expressed support for Paraguay's actions. Some have even expressed their intention to follow the country's example by adopting similar laws to combat this illegal practice.

A decision that contrasts with other measures on the continent

In conclusion, Paraguay has taken radical steps to counter clandestine Bitcoin mining that threatens its national power grid. However, it is important to emphasize that the government is targeting illegal miners who are not registered in the national register. However, mining operations are not prohibited on Paraguayan territory.

However, the country does not seem to be part of a pro-bitcoin movement while other countries do. Latin America like El Salvador, for example, made bitcoin legal tender in 2021. This is also the region where we notice a strong adoption of bitcoin, due to the multiple inflationary crises experienced by certain countries like argentina or Venezuela, for example.

When some countries see it as an obstacle, others see bitcoin as an opportunity.

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