On October 4, El Salvador’s first mining pool called Lava Pool started operating as part of the Volcano Energy project. The project was launched by the government in partnership with various companies, including the USDT issuer Tether. The main feature of this Bitcoin mining pool is using solar and wind renewable energy.
With the growth of Bitcoin’s network, mining in solo does not seem to be economical. To solve this problem, mining pools allow users to combine their computational power and share rewards in proportion based on the provided capacity.
What is a Volcano Energy project
The Volcano Energy project was announced in June, 2023. According to the press release, in addition to the financial interest, the project aims to expand and strengthen the Bitcoin network, and promote El Salvador as a major player in the industry.
The vision for the project is as follows:
🔌 Create a large-scale renewable power generation park in the Metapán city;
Sell access to electricity to hardware owners;
💰 Generate and distribute profits.
Volcano Energy in numbers
The total capacity of Volcano Energy will be 241 MW (megawatts):
☀️169 MW from solar power;
💨72 MW from wind power.
As stated in the announcement, the Volcano project is "one of the world's largest Bitcoin mining farms, with an initial computational power surpassing 1.3 EH/s". For comparison, Bitcoin's current hashrate is 412 EH/s. One of the most powerful mining devices, Antminer S21 has 335 TH/s. Converted to terahash, 1.3 EH/s equals 1,300,000 TH/s, meaning that Volcano Energy's power is equivalent to almost 3,900 of these devices.
Bitcoin hashrate is the collective computational power used for mining cryptocurrencies. It guages the quantity of hash calculations executed by Bitcoin miners each second throughout the entire network. Hashrate is commonly expressed in various units, such as hashes per second (h/s), kilohashes (Kh/s), megahashes (Mh/s), gigahashes (Gh/s), terahashes (Th/s), petahashes (Ph/s), or even exahashes (EH/s). Read more about these values here.
The total cost of the Volcano Energy project is $1 billion. However, the first phase raised only $250 million. The dates of the next phases remain unknown. Tether, the issuer of the USDT stablecoin, and Luxor Technology, a company responsible for the necessary software and services for mining, are among the project’s partners.
Profits will be distributed as follows:
🇸🇻 23% to El Salvador;
💰 27% to investor companies;
💸 50% to be reinvested in the project.
By the way, El Salvador is not the most attractive country for Bitcoin mining; find out the top countries in our breakdown: CoinGecko's report on Bitcoin mining costs.
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