Volcano Energy announced $1 billion in commitments to build a 241 megawatt (MW) bitcoin mine in the Metapán region of El Salvador, according to a Monday press release on Twitter. One of the investors is Tether, the issuer of stablecoin USDT, according to a separate press release shared with CoinDesk.
The mining site will be powered with 169 MW of solar and 72 MW of wind energy to bring computing power of over 1.3 exahash/second (EH/s), the press releases said. It will be located in Metapán, Santa Ana, in the country's northwest.
The government will play "a crucial role" in planning and execution and has secured a "preferred participation equivalent to 23% of revenues," said Volcano. The outside investors will own 27% of the venture and the remaining 50% will be "reinvested" to expand energy production and mining capacities, the firm said.
Earlier mining initiatives have been focused on El Salvador's geothermal energy potential, but it was unclear how this new solar and wind energy park would be connected with volcanic activity. In its press release, Volcano mentioned that this mining site is intended as a "pathway to our geothermal future," but didn't clarify the roadmap.
Tether has been trying to diversify its "strategic ecosystem" and Volcano Energy represents one of "the most ground-breaking" initiatives it has backed, said Chief Technology Officer Paolo Ardoino. The stablecoin issuer has been busy on the investment front in the past few weeks, including on bitcoin mining in Uruguay and purchasing bitcoin to add to its reserves backing USDT.
As opportunities for new developments have been limited in North America, mining firms and others have been looking elsewhere for investments in places such as Latin America and the Middle East.
UPDATE (June 5, 14:35 UTC): Adds details on Tether throughout.
CoinDesk is an award-winning media outlet that covers the cryptocurrency industry. Its journalists abide by a strict set of editorial policies. In November 2023, CoinDesk was acquired by the Bullish group, owner of Bullish, a regulated, digital assets exchange. The Bullish group is majority-owned by Block.one; both companies have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary with an editorial committee to protect journalistic independence. CoinDesk offers all employees above a certain salary threshold, including journalists, stock options in Bullish Group as part of their compensation.