Bitcoin News Today: Paraguay's Power Surplus Could Fuel a Bitcoin Sovereignty Gambit

Paraguay is exploring the creation of a national Bitcoin reserve to leverage its massive surplus of clean electricity and diversify its financial portfolio. The country produced more than 37,000 gigawatt-hours of electricity in the first half of 2025—nearly three times its domestic consumption—largely from the Itaipú and Yacyretá hydropower plants. This surplus, currently exported at fixed prices, is now being considered as a resource to fuel Bitcoin mining, with the resulting Bitcoin serving as a hedge against inflation and a means to enhance financial sovereignty [1].

The concept of a Bitcoin reserve is gaining momentum among policymakers. A proposed study initiated in 2024 by Senator Salyn Buzarquis aims to assess how this surplus energy can be turned into a strategic asset. Paraguay’s upcoming Bitcoin conference in Asunción on September 15 and 16 will serve as a critical platform for stakeholders to discuss the feasibility and implications of the plan. Industry leaders such as Hive Digital CEO Aydin Kilic and Bitcoin advocate Samson Mow will participate, emphasizing the potential for sustainable mining and the role of Bitcoin in future financial systems [1].

Globally, several countries have already explored or implemented similar strategies. Bhutan has mined approximately 13,000 Bitcoin using its hydropower, El Salvador holds over 6,000 coins in sovereign reserves, and the United States maintains a strategic Bitcoin reserve of nearly 200,000 coins [1]. Paraguay is not alone in this endeavor, as other nations including Iran, Russia, and the Czech Republic have also experimented with state involvement in Bitcoin.

However, the initiative is not without risks. Bitcoin's price volatility—swinging between 15 to 25 percent within weeks—poses challenges to maintaining a stable reserve. Additionally, Bitcoin mining demands significant upfront investment with limited job creation, which may limit its broader economic benefits. Paraguay must also navigate the conditions of its $285 million IMF program, which requires fiscal responsibility. Any move toward a state-backed Bitcoin reserve must align with these obligations to avoid disrupting other areas of the economy [1].

Further complicating the matter is the evolving regulatory landscape. While Paraguay does not yet have specific laws governing stablecoins or Bitcoin reserves, it has established anti-money laundering regulations that apply to crypto assets. The Central Bank of Paraguay has also stated that cryptocurrencies, including Bitcoin, lack legal tender status and carry no state guarantee, emphasizing the need for caution and transparency in any new financial strategy [3].

As HIVE Digital Technologies expands its operations in Paraguay, it has completed Phase 2 of its Yguazú project, reaching a hashrate of 18 Exahash per second and mining over 8.5 Bitcoin daily using hydroelectric power from the Itaipú Dam. The company is also advancing its Valenzuela site, with 100 megawatts of green energy infrastructure now operational. These developments signal the growing importance of Paraguay in the global Bitcoin mining sector, with HIVE projecting that its global fleet could reach 3% of the Bitcoin network’s total mining capacity by U.S. Thanksgiving [2].

Source:

[1] Paraguay to hold meeting on creating strategic Bitcoin Reserve (https://coinfomania.com/paraguay-to-hold-meeting-on-creating-strategic-bitcoin-reserve/)

[2] HIVE Digital Technologies Completes Phase 2 Of Its Yguazu Project In Paraguay Reaching 18 EH/s, Producing 8 Bitcoin Per Day From Hydroelectric Power (https://www.mexc.com/en-GB/news/hive-digital-technologies-completes-phase-2-of-its-yguaz-project-in-paraguay-reaching-18-eh-s-producing-8-bitcoin-per-day/83449)

[3] Navigating The Risks And Rules For Stablecoins In Paraguay (https://asunciontimes.com/paraguay-news/tech-news/an-overview-risks-and-rules-for-stablecoins-in-paraguay/)