El Salvador, the first country to adopt Bitcoin as its official currency, is set to implement another project. The Bitcoin mining pool for the Volcano Energy project, which aims to conduct Bitcoin mining using the country’s renewable energy sources, has officially been launched. The Volcano Energy project will begin with the construction of renewable energy facilities and will eventually utilize El Salvador’s geothermal energy sources.
The renewable energy project, valued at one billion dollars, first made headlines in early 2023. Tether, the issuer of the stablecoin, is among the companies investing in the project, which plans to generate electricity from local sources in El Salvador to support future Bitcoin mining operations.
Volcano Energy, leveraging Luxor’s Bitcoin mining software and services, will also utilize Luxor’s Hashrate Forward Marketplace, which employs automated risk management strategies used by other major Bitcoin mining operators, to mitigate market volatility.
Gerson Martinez, the project’s chief strategy officer, highlighted El Salvador’s ongoing efforts to gain a first-mover advantage as a nation-state that embraces Bitcoin:
“Our vision is to create a vertically integrated energy and Bitcoin mining company that adds value to investors and all Salvadoran citizens.”
Ethan Vera, the director of operations at Luxor, stated that the implementation of Volcano Energy and the activation of local Bitcoin mining operations contribute to the principle of decentralization in Bitcoin.
The announcement also mentions the potential of using Bitcoin mining to improve the economy of countries rich in renewable energy resources. Mining activities can serve as a revenue stream for energy producers and provide an alternative source of income.
Volcano Energy, a collaboration between the public and private sectors, will allocate 23% of its mining revenue to the Salvadoran government. The plan is to invest the profits from mining into infrastructure services to promote economic and technological growth in the country.
The first phase of the project involves the construction of a 241-megawatt (MW) renewable energy facility consisting of 169 MW of photovoltaic solar energy and 72 MW of wind energy in Metapan. The long-term goal of the project is to harness the abundant geothermal energy resources in the country.