El Salvador Pushes for Bitcoin Mining Pact with Latin America
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El Salvador is seeking to expand its role as a regional leader in Bitcoin adoption by proposing a cooperative mining pact with other Latin American nations. President Nayib Bukele’s administration has begun discussions with governments in Paraguay, Argentina, and Brazil to create what it calls a “sustainable mining alliance,” aimed at boosting energy-efficient crypto production while fostering economic integration across the region.
According to sources familiar with the talks, the plan would involve coordinating energy resources, particularly renewable power, to support Bitcoin mining at scale. El Salvador, which already runs several geothermal-powered mining farms fueled by its volcanic energy reserves, is promoting the pact as a way for Latin America to capitalize on its natural advantages. Countries like Paraguay and Brazil have vast hydroelectric capacity, while Argentina holds untapped wind and solar potential.
Officials in San Salvador argue that by pooling resources, Latin American countries could establish themselves as a global hub for sustainable Bitcoin mining, reducing reliance on fossil fuels while increasing revenues from cryptocurrency exports. They also see the pact as a counterbalance to mining dominance in countries like the United States, Russia, and Kazakhstan.
The move is consistent with El Salvador’s broader strategy since becoming the first country to adopt Bitcoin as legal tender in 2021. Despite criticism from the International Monetary Fund and some financial institutions, the Bukele government has doubled down on its Bitcoin bet, using state funds to accumulate reserves and launching initiatives to attract digital asset companies. The mining pact is seen as the next logical step in deepening this strategy.
Reactions across the region are mixed. Paraguay, which has faced internal debates over whether to formalize crypto mining legislation, is reportedly receptive to the idea, given its abundant Itaipu Dam power surplus. Argentina’s government is more cautious, as the country grapples with economic instability and currency controls, though private sector players there have shown interest. Brazil, meanwhile, remains divided: while energy companies are exploring blockchain-related ventures, regulators remain wary of aligning too closely with Bitcoin mining.
Environmental groups have voiced concerns that even renewable-powered mining could strain local ecosystems and divert energy from households and industries. Critics argue that energy resources should first serve domestic needs before being redirected to crypto operations.
Nonetheless, advocates of the pact stress that mining could be a tool for economic development if managed responsibly. They argue that revenues from Bitcoin production could help finance infrastructure, create jobs, and strengthen regional cooperation in a sector where Latin America has historically lagged.
If successful, the pact would mark one of the first multinational efforts to jointly regulate and promote Bitcoin mining. While negotiations are still in early stages, El Salvador’s push reflects its ambition to shape the future of digital assets in the region, even as global regulators intensify scrutiny of the crypto industry.
