Paraguay, a country in South America is known for its energy abundance. Nevertheless, just like most of the other countries in the region, Paraguay is struggling financially. The presence of excess and cheap electricity has encouraged Cryptocurrency mining in the nation. However, politicians and experts have aired contradicting views on how the excess power should be used in poverty reduction.
Cryptocurrency Mining Becomes Popular In Paraguay
Paraguay is home to Itaipu, the largest hydroelectricity dam in South America. This has enabled the country to supply its citizens with cheap electricity that costs as low as $0.5 per kilowatt-hour. However, Crypto activities in the country have also increased due to the cheap power. The popularity of Bitcoin, Ethereum, and other Crypto mining activities are growing every day in the country.
Barreiro is one of the growing numbers of Crypto entrepreneurs in the country that believes that the government should do more to encourage Crypto activities. He argues that, if the government improves the business environment, more China-based factories may move to the country creating more job opportunities for the locals.
It has been widely reported that Cryptocurrency mining has replaced traditional illicit activities like drug trafficking in the country. Those in support of the Crypto industry believe that the government should encourage more people to join the sector. They argue Crypto mining could help in addressing unemployment and other social-economic challenges in the country.
The Current Paraguay Economy
Although Paraguay is more developed than most of the other countries in South America, it still ranks low compared to other countries worldwide. The country’s average wage of $329 is not comparable to those in more developed countries in Europe and North America. Besides, although the country has experienced a significant economic growth in the past decade or so, poverty remains a serious issue.
Paraguay also has a foreign debt that it is struggling to clear. Although the dam can help the country in addressing various economic challenges, the government has the responsibility of identifying the best way to go about it. The excess energy can help the country to attract foreign firms that may create more job opportunities for the locals.
How The Excess Electricity Can Be Used To Eradicate Poverty
Cryptocurrency mining is playing a major role in addressing poverty issues in the country. The government may choose to embrace Crypto mining and help in creating more job opportunities. Furthermore, the income generated in these activities could also be used in other sectors of the economy thereby improving the well-being of the locals.
However, there are those who believe Crypto mining cannot provide a solution to the current economic challenges in the country. They believe that exporting excess power to neighboring countries such as Brazil can help the country clear its international debt and boost its war on poverty. Those who support this opinion argue that Crypto mining is a power-intensive process that is not profitable without cheap power.
For Paraguay, all the involved parties must explore the existing options before deciding the next move. Politicians and academics in the country should balance the different ideas and settle on one that they believe will be more effective in addressing the social and economic problems. For now, Cryptocurrency miners have no option but to continue minting more coins in the hope that the government will not illegalize their activities.