Paraguay faces energy crisis due to cryptocurrency mining, warns UIP

Electric consumption linked to cryptocurrency could attempt the country’s energy sustainability. Experts warn that, without immediate action, a “blackout” Towards 2030.

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• He Study Center of the UIP It foresees an energy collapse in less than a decade.
• The Government will invest USD $ 359 million in infrastructure to detect irregularities.
• Natural gas and a thermoelectric plant emerge as viable alternatives.

Paraguay has positioned itself as an attractive destination for cryptocurrency mining, thanks to its abundant hydroelectric energy and low electrical cost. However, this competitive advantage now threatens to become a systemic risk.

According to a report published by the medium Beinypto, For him Center for Economic Studies of the Paraguayan Industrial Union (UIP)the country could face a critical energy deficit between 2029 and 2030. The Iitaipú and Yacyretá dams, which generate most Paraguayan electricity, would be operating above their optimal capacity due to the growing demand for crypto miners.

The warning was repeated by Julio Fernández, head of the Studies Center of the Uip, who pointed out that “If you don’t act soon, there will be an energy blackout”. According to its calculations, only for the use of electric tolls, Paraguay could generate annual income of up to USD $ 400 million if its industry properly structures.

Ande Recognize the problem and propose measures

Months ago, the National Electricity Administration (Ande) admitted that activities related to cryptocurrency have significantly elevated electrical consumption. To face this challenge, an investment of USD $ 359 million between 2025 and 2028 announced.

This amount will be intended for the modernization of its infrastructure, with the aim of reducing by 15% the theft of electricity, optimizing the efficiency of the system and detecting anomalous consumptions, especially in areas with concentration of mining farm.

The Ande Consider that technological innovation will be key to anticipating demand peaks and avoiding mass failures in the supply. However, experts insist that these measures should be complemented with a diversification of energy sources.

Back with the UIP reading, given the growing pressure, various solutions are considered to avoid the collapse of the system. Fernández proposes the installation of a natural gas -based thermoelectric plant, which would not only cover national demand, but also export the surplus to Brazil.

“Solar energy is promising, but does not resolve the urgency of the coming years. Gas is the most viable alternative right now”he said.

In addition, he stressed that the existing regulation must be adjusted to ensure that mining operations do not compromise the supply to other strategic sectors of the country, such as the manufacturing industry or residential consumption.

Favorable legal framework but with challenges

Since 2019, Paraguay has a Cryptocurrency law which establishes a legal framework for mining and trade in cryptoactive. This legislation sought to attract investments and formalize an activity that was already frequent in several regions of the country.

The law establishes conditions for the installation of mining operations, as well as technical and fiscal requirements. However, the accelerated growth of the crypto industry has exceeded initial projections and generated a debate on its real impact on national energy infrastructure.

While it has promoted employment and technological development in rural areas, the lack of long -term planning puts the sustainability of the entire system at risk.

If not acting urgently, Paraguay could be forced to make drastic decisions, such as restricting the supply to certain activities or increasing electrical rates. This would not only affect the crypto industry, but the entire national economy.

The country faces a crossroads between taking advantage of its energy advantages to lead in blockchain technology or protect its infrastructure to guarantee sustainable growth. The decisions taken in the coming years will be crucial to define their energy future.

Written article with the help of an AI content editor, edited by Angel Di Matteo / Diariobitcoin

Original image of Diariobitcoin, created with artificial intelligence, for free use, licensed under public domain.

WARNING: Diariobitcoin offers informative and educational content on various topics, including cryptocurrencies, AI, technology and regulations. We do not provide financial advice. Cryptactive investments are high risk and may not be adequate for all. Investigate, consult an expert and verify the applicable legislation before investing. I could lose all its capital.

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