Earlier this week, the small Central American republic of El Salvador went down in history as the first country in the world to accept Bitcoin as legal tender.
Now, in a move that sounds straight out of a Bond film, President Nayib Bukele has announced an innovative plan to capitalize (get it?) on the new national currency: volcanoes.
In a tweet posted within hours of the country’s adoption of the cryptocurrency, Bukele told the world that he had instructed the head of the state-owned geothermal electric company to set up facilities for volcano-powered Bitcoin mining.
El Salvador may be the smallest country in Central America, but it is one of the world champions of geothermal energy production. That’s because it sits right in the middle of the Central American Volcanic Arc: a 1,500-kilometer-long (930 miles) chain of hundreds of volcanoes that stretches all the way from Guatemala to Panama. By harnessing the thermal energy of its 23 active volcanoes, El Salvador is able to renewably produce around one-quarter of its national power consumption through steam-powered turbines.
That’s important because energy consumption is a big problem with Bitcoin. To obtain the cyber currency, computer users must “mine” it – in other words, they use the processing power of their machines to solve complex math problems. These solutions are used to verify previous transactions, and some Bitcoin is created on the side for the miner.
But unlike normal money, there’s a limited amount of Bitcoin – once it’s all been “mined”, that’s it, no quantitative easing or inflation allowed. And that is why the price has skyrocketed recently, resulting in graphics cards, and pretty soon a whole lot of other things, going extinct. In terms of countries, Bitcoin mining is now responsible for more power consumption than Argentina, and it’s catching up on the Czech Republic.
While this environmental impact is alarming, not everybody is convinced, with many Bitcoin fans saying that the currency’s popularity will reinvigorate renewable energy technology. El Salvador’s planned volcano mine, which comes only a couple of weeks after the creation of the Elon Musk-blessed Bitcoin Mining Council, is one hopeful hint that they may be right.
“Our engineers just informed me that they dug a new well, that will provide approximately 95MW of 100% clean, 0 emissions geothermal energy from our volcanos,” Bukele tweeted, along with a video which he said was a jet of pure water vapor being ejected from a pipeline. “Starting to design a full #Bitcoin mining hub around it.”