- Argentinian presidential hopeful wants to use natural gas from an oil field to mine Bitcoin, a proposal that has sparked a heated debate among the crypto community.
- While some welcome the input, others argue that getting the government involved in crypto mining would soon lead to unfriendly regulations and restrictions.
On November 19, Argentina will head to the polls for the run-off faceoff between Sergio Massa and Javier Milei. While long-running topics like inflation, price controls, and impunity will take center stage, the election will have a new topic for the voters: Bitcoin mining.
Massa is the candidate for the ruling Union of the Homeland and is the current Economy Minister for Argentina. He won the first round with 36.6% of the votes against his opponent’s 30%. He has pledged to fight the rising poverty and steer his nation from one of its worst economic crises. He has also promised to dive into Bitcoin mining, a pledge now sparking national debate.
Massa proposes to utilize the excess natural gas from the Vaca Muerta oil fields to mine Bitcoin. Through computer scientist Santiago Siri, the candidate pointed out that the excess gas from the oil field goes to waste. By introducing Bitcoin mining, the country can make millions through a resource that nobody utilizes today.
Some in the local crypto scene are entirely behind the proposal. José María Sarasola is one of the people in support of the proposal. Sarasola, who runs local crypto startup Cryptogranjas, told a local outlet that Bitcoin is a perfect solution for the oil fields. He opined.
This excess gas often means that the well has to be closed. Right there, Bitcoin appears as the perfect partner. This gas has no way of being used because it cannot be vented, and through mining, it can be reused by consuming it without having to release it into the atmosphere.
Sarasola’s company mines Bitcoin in the same area using gas from organic material and industrial waste.
“Not So Fast!” Bitcoin and the State Don’t Mix
The plan to mine Bitcoin from excess gas hasn’t set well with some. While most concur that Argentina needs to invest more in Bitcoin, they believe the state shouldn’t get involved in crypto.
One of those opposed to the plan is Rodolfo Andragnes, the co-founder of the local industry association Bitcoin Argentina. He says that rather than mine BTC, the government should empower the private sector to mine. It could lower or subsidize power costs for the sector and lower restrictions and taxes for the importation of mining rigs, he says.
Some noted that Bitcoin mining is no longer as profitable as it once was. For others, the government lacks the technical expertise to execute the plan.
It is an activity where you must know how to manage the balance point between profits and losses. You have to continually evaluate costs and profitability, taking into account that sometimes you are forced to sell the bitcoins you produce.
Meanwhile, Argentina continues to experience hyperinflation. The local peso has lost 50% of its value against the dollar so far this year. In contrast, Brazil and Mexico’s currencies have made gains against the USD.
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