Venezuela and Paraguay could capitalize on exodus of Chinese cryptocurrency miners

RIO DE JANEIRO, BRAZIL – Since Beijing launched a campaign against bitcoin last May, 14 of the world’s largest cryptocurrency miners relocated more than 2 million pieces of equipment to other countries, mainly the USA, Canada, Kazakhstan and Russia.

Chinese companies Bitfufu and BIT Mining, for instance, sent 80,000 and 7,849 machines to Kazakhstan, respectively. Another beneficiary of this move was Russia, which now houses some 1.8 million machines from China, according to estimates by Moscow-based cryptocurrency miner BitRiver.

Moving older mining equipment like Antminer S9 to the U.S. is not profitable, so the older-generation machines end up in countries like Venezuela or Paraguay, which are less stable from a regulatory standpoint but have cheap electricity.

According to Venezuelan Doctor Miner co-founder Juan José Pinto, the Chinese ban “is a great opportunity.” Three large companies from the Asian giant approached his Caracas-based company to relocate some 7,000 machines. “If we had resources, we could house many more,” Pinto said.

They are obsolete machines and more prone to breakdowns, but Pinto and his staff capitalize on that “graveyard: “if they have one machine with 4 broken parts and another with 6, they assemble them into a good one.”

In an economy as battered as Venezuela’s, small mining farms help to survive. “People mine in their homes with a single machine,” Pinto said. “There are thousands of people here with small farms. Earning an extra US$100 a month is a big difference for them,” he added.

Asunción-based Digital Assets also plans to house 15,500 mining machines in the coming months, although some private individuals in Paraguay are beginning to compete with it by acquiring machines to mine independently.